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STRATEGIC EVALUATION ON ENVIRONMENT AND RISK PREVENTION UNDER STRUCTURAL AND COHESION FUNDS

FOR THE PERIOD 2007-2013 Contract No. 2005.CE.16.0.AT.016.

National Evaluation Report for Greece

Main Report Directorate General Regional Policy

A report submitted by

in association with

ECOLAS, IEEP and CE

Date: November 10th, 2006 GHK Brussels

Rue de la Sablonnière, 25 B-1000 Brussels

Tel: +32 (0)2 275 0100; Fax : +32 (2) 2750109

GHK London

526 Fulham Road London, United Kingdom SW6 5NR

Tel: +44 20 7471 8000; Fax: +44 20 7736 0784 www.ghkint.com

Strategic Evaluation of Environment and Risk Prevention – Country Report – Greece

GHK, ECOLAS, IEEP, CE i

TABLE OF CONTENTS

EXECUTIVE SUMMARY................................................................................................................. 1 1 INTRODUCTION AND METHODOLOGY ................................................................................ 2 1.1 Framework of the National Evaluation Study...................................................................... 2 1.2 Study Objectives ................................................................................................................. 2 1.3 Method of Approach............................................................................................................ 2 1.4 Structure of National Study Report ..................................................................................... 3 2 OVERVIEW AND HORIZONTAL ISSUES............................................................................... 5 2.1 Country Overview................................................................................................................ 5 2.2 Status of Implementing the EU Environmental Acquis ....................................................... 8 2.3 Environmental Policies, Strategies and Planning ............................................................... 9 2.3.1 National Reform Programme 2005-2008............................................................................ 9 2.3.2 Status of 2007-2013 Programming ................................................................................... 10 2.3.3 National Strategic Development Plan for the Environment Sector for the Period 2007-2013……........................................................................................................................................ 10 2.3.4 National Spatial Plan......................................................................................................... 11 2.4 Overview of Environmental Expenditure – Structural and Cohesion Fund Support ......... 12 2.5 Institutional and Administrative Capacity Issues............................................................... 14 2.5.1 Public Private Partnerships............................................................................................... 14 2.5.2 Fund Absorption Capacity................................................................................................. 14 2.5.3 Institutional Issues in Future Planning/Programming ....................................................... 15 3 WATER SUPPLY.................................................................................................................... 17 3.1 Current Situation ............................................................................................................... 17 3.1.1 Current State of Provision................................................................................................. 17 3.1.2 Drinking Water Demand.................................................................................................... 17 3.1.3 Drinking Water Quality ...................................................................................................... 18 3.1.4 State of Infrastructure........................................................................................................ 19 3.1.5 Water Prices – User Charges ........................................................................................... 20 3.2 Analysis of Future Needs.................................................................................................. 21 3.2.1 Review of Policy Objectives and Targets.......................................................................... 21 3.2.2 Trends in Water Demand.................................................................................................. 22 3.2.3 Investment Needs to Improve Drinking Water Quality...................................................... 25 3.2.4 Investment Needs to Improve and/or Replace Obsolete or Non-Compliant Infrastructure25 3.2.5 Summary Assessment of Physical Investment Needs ..................................................... 26 3.2.6 Indicative Financial Investment Requirement ................................................................... 28 3.3 Assessment of Field Priorities........................................................................................... 28 3.3.1 Initial Ranking of Priorities within the Water Supply Field................................................. 29 3.3.2 Feasibility of Managing and Delivering SF/CF Programmes to Meet Needs ................... 29 4 WASTE WATER TREATMENT.............................................................................................. 32 4.1 Current Situation ............................................................................................................... 32 4.1.1 Current State of Provision................................................................................................. 32 4.1.2 State of Infrastructure........................................................................................................ 32 4.1.3 Waste Water Services Pricing - User Charges................................................................. 34 4.2 Analysis of Future Needs.................................................................................................. 34 4.2.1 Review of Policy Objectives and Targets.......................................................................... 34 4.2.2 Physical Investment Needs............................................................................................... 35 4.2.3 Trends in Demand............................................................................................................. 36


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4.2.4 Indicative Financial Investment Requirement ................................................................... 36 4.3 Assessment of Field Priorities........................................................................................... 37 4.3.1 Initial Ranking of Priorities within the Waste Water Treatment Field................................ 37 4.3.2 Feasibility of Managing and Delivering SF/CF Programmes to Meet Needs ................... 38 5 MUNICIPAL SOLID WASTE MANAGEMENT....................................................................... 39 5.1 Current Situation ............................................................................................................... 39 5.1.1 Current State of Provision................................................................................................. 40 5.1.2 State of Infrastructure........................................................................................................ 41 5.1.3 Policy on Waste Charges.................................................................................................. 42 5.2 Analysis of Future Needs.................................................................................................. 42 5.2.1 Review of Policy Objectives and Targets.......................................................................... 42 5.2.2 Review of Future Trends................................................................................................... 44 5.2.3 Physical Investment Needs and Indicative Financial Estimates....................................... 47 5.2.4 Unit Investment & Operating Costs................................................................................... 52 5.2.5 Indicative Financial Investment Requirement ................................................................... 53 5.3 Assessment of Field Priorities........................................................................................... 54 5.3.1 Initial Ranking of Priorities within the Municipal Solid Waste Management Field............. 54 5.3.2 Feasibility of Managing and Delivering SF/CF Programmes to Meet Needs ................... 55 6 RENEWABLE ENERGY......................................................................................................... 58 6.1 Current Situation ............................................................................................................... 58 6.1.1 Current State of Provision................................................................................................. 58 6.1.2 State of Infrastructure........................................................................................................ 59 Figure 3 Installed Capacity of Solar Collectors for Water Heating (Source: NCESD Environmental Signals Report).............................................................................................................................. 60 6.1.3 Renewable Energy Pricing and Support Issues ............................................................... 60 6.2 Analysis of Future Needs.................................................................................................. 61 6.2.1 Review of Policy Objectives and Targets.......................................................................... 61 6.2.2 Review of Instruments and Support Schemes.................................................................. 62 6.2.3 Supply and Demand Forecasts......................................................................................... 63 6.2.4 Costs of Infrastructure / Technologies .............................................................................. 64 6.2.5 Indicative Financial Investment Requirement ................................................................... 64 6.3 Assessment of Field Priorities........................................................................................... 65 6.3.1 Initial Ranking of Priorities within the Renewable Energy Field........................................ 65 6.3.2 Feasibility of Managing and Delivering SF/CF Programmes to Meet Needs ................... 66 7 NATURAL RISK MANAGEMENT (FIRE, DROUGHT, FLOODS)......................................... 75 7.1 Current Situation ............................................................................................................... 75 7.1.1 Current State of Provision................................................................................................. 75 7.1.2 Existing Risk Assessments ............................................................................................... 77 7.2 Analysis of Future Investment Needs ............................................................................... 78 7.2.1 Review of Policy Objectives and Targets.......................................................................... 79 7.2.2 Instruments and Support Schemes................................................................................... 79 7.2.3 Indicative Financial Investment Requirement ................................................................... 80 7.3 Assessment of Field Priorities........................................................................................... 80 7.3.1 Initial Ranking of Priorities within the Natural Risk Management Field ............................ 81 7.3.2 Feasibility of Managing and Delivering SF/CF Programmes to Meet Needs ................... 81 8 CROSS FIELD PRIORITY ASSESSMENT............................................................................ 83 8.1 Introduction ....................................................................................................................... 83


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8.2 Point Scoring..................................................................................................................... 83 8.3 Multi-Criteria Analysis ....................................................................................................... 84 8.4 Revised Point Scoring Allocation ...................................................................................... 89 8.5 Indicative Investment Share by Region ............................................................................ 90 9 SUMMARY CONCLUSIONS.................................................................................................. 92 9.1 Key Issues for Consideration in 2007-2013 SC/CF Programming ................................... 92 9.1.1 Horizontal Issues............................................................................................................... 92 9.1.2 Water Supply..................................................................................................................... 92 9.1.3 Waste Water Treatment .................................................................................................... 92 9.1.4 Municipal Solid Waste....................................................................................................... 93 9.1.5 Renewable Energy............................................................................................................ 93 9.1.6 Natural Risk Management................................................................................................. 93 9.2 Summary of Needs and Priorities ..................................................................................... 94 10 Reference List ................................................................................................................... 95 10.1 Across Fields..................................................................................................................... 95 10.2 Water Supply..................................................................................................................... 96 10.3 Municipal Solid Waste....................................................................................................... 96 10.4 Renewable Energy............................................................................................................ 97 10.5 Natural Risk Prevention .................................................................................................... 98 10.6 Interviews .......................................................................................................................... 98 ANNEX A....................................................................................................................................... 99 1 2006 STRUCTURAL AND COHESION FUND INVESTMENT IN THE STUDY FIELDS...... 99 1.1 Environmental Investment – EU Structural Assistance .................................................... 99 1.2 Water Supply................................................................................................................... 100 1.2.1 General MS Funding ....................................................................................................... 100 1.2.2 Cohesion Fund................................................................................................................ 100 Structural Funds (European Regional Development Fund) ........................................................ 100 1.2.3 Key Observations............................................................................................................ 102 1.3 Waste Water Treatment .................................................................................................. 102 1.3.1 General MS Funding ....................................................................................................... 102 1.3.2 Cohesion Fund................................................................................................................ 102 1.3.3 Structural Funds (European Regional Development Fund)............................................ 103 1.3.4 Key Observations............................................................................................................ 104 1.4 Municipal Solid Waste..................................................................................................... 104 1.4.1 General MS Funding ....................................................................................................... 104 1.4.2 Cohesion Fund................................................................................................................ 105 1.4.3 Structural Fund (European Regional Development Fund).............................................. 106 1.4.4 Key Observations............................................................................................................ 107 1.5 Renewable Energy.......................................................................................................... 107 1.5.1 General MS Funding ....................................................................................................... 107 1.5.2 Structural Funds (European Regional Development Fund)............................................ 108 1.5.3 Key Observations............................................................................................................ 109 1.6 Natural Risk Management (Fire, Drought, Floods) ......................................................... 109 1.6.1 General MS Funding ....................................................................................................... 109 1.6.2 Cohesion Fund................................................................................................................ 109 1.6.3 Structural Funds (European Regional Development Fund)............................................ 109 1.6.4 Key Observations............................................................................................................ 112


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ANNEX B..................................................................................................................................... 113 2 INSTITUTIONAL CONTEXT AND RELATED ISSUES ....................................................... 113 2.1 Water Supply................................................................................................................... 113 2.1.1 Waste Water Treatment .................................................................................................. 114 2.1.2 Municipal Solid Waste..................................................................................................... 114 2.1.3 Renewable Energy.......................................................................................................... 115 2.1.4 Natural Risk Management (Fire, Drought, Floods) ......................................................... 115 ANNEX C..................................................................................................................................... 117 3 FIELD INDICATORS – SUMMARY DATA TABLES ........................................................... 117 3.1 Water Supply Summary Data Table ............................................................................... 117 Waste Water Treatment Summary Data Table ........................................................................... 119 Municipal Solid Waste Summary Data Table .............................................................................. 121 Renewable Energies Summary Data Table ................................................................................ 122 ANNEX D..................................................................................................................................... 124 4 DRINKING WATER SUPPLY AND SEWERAGE CHARGES............................................. 124 ANNEX E..................................................................................................................................... 126 5 RENEWABLE ENERGY PRICING: SALES TO THE GRID OF RES PRODUCED ELECTRICITY.. ........................................................................................................................... 126


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EXECUTIVE SUMMARY See separate document.



1 INTRODUCTION AND METHODOLOGY

1.1 Framework of the National Evaluation Study This report presents the results of the National Evaluation Study on Greece undertaken within the framework of the study on the “Strategic Evaluation of Environment and Risk Prevention Under Structural and Cohesion Funds, 2007-2013” during the period November 2005 to June 2006.

The Strategic Evaluation study is undertaken by the consortium GHK, ECOLAS, IEEP and CE on behalf of the European Commission, Directorate General REGIO. The study covers a total of fifteen EU Member States: Greece, Portugal, Spain, each of the ten New Member States, Romania and Bulgaria. The study requires the compilation of a National Evaluation Report on each of the above countries, as well as an overall Evaluation Study Synthesis Report.

1.2 Study Objectives In line with the terms of reference, the study concerns five environmental Fields: Water Supply; Waste Water Treatment; Municipal Solid Waste Management; Renewable Energy; and National Risk Management with respect to Fire, Drought and Floods.

For each of the five Fields, the study aims to identify and critically assess in both qualitative and quantitative terms the physical as well as the financial investment needs and priorities for Structural and Cohesion Fund support over the 2007-2013 programming period. In addition, the study identifies and assesses complementary policies (for example, flanking measures on cost recovery and public private sector partnerships) to improve the efficiency of the Structural and Cohesion Fund investment.

1.3 Method of Approach The National Evaluation Study on Greece applies the central methodological framework requirements of the Strategic Evaluation (ref. Study Synthesis Report) and follows the detailed guidelines provided by the central study team to all national evaluators.

The assessment of needs and priorities is based on three key criteria: (a) compliance with EU environmental legislative requirements (environmental acquis); (b) conformance with other policies; (c) the overall need to promote regional and economic competitiveness and convergence. A Multi-Criteria Analysis is also applied to review priorities across fields.

The national evaluator has relied on the key policy and planning documents available at the time of undertaking this study, as well as on interviews with key policy actors (competent ministerial and managing authority services), to identify needs and priorities in each of the Study Fields. An extensive list of secondary sources has also been used to review and assess the current state of provision and infrastructure in each Study Field.

As of June 2006 (end of research and study period), the draft proposals on the 2007-2013 Greek National Strategic Reference Framework and Operational Programmes were not available. No quantitative data were thus available per Study Field with respect to the needs, priorities and financial plans that would require Structural and Cohesion Fund assistance over the next programming period. The national evaluator has therefore proceeded with an independent assessment of physical and financial investment needs (as opposed to a critical review of existing programme quantitative targets and financial plans).

The availability of quantitative data on physical needs, or on other parameters that enable the estimation of physical and/or financial investment needs (such as infrastructure baseline indicators, demand forecasts, unit investment costs) varies significantly between Study Fields. In the absence of such data being readily available, notably in the cases of Water



Supply, Waste Water Treatment and Natural Hazards, the analysis and assessment of needs has been undertaken in qualitative terms. Equally, for the production of indicative investment cost estimates required by this study, the evaluator has applied different methods in the case of each Study Field for producing rough indications of scale of investment requirement, depending on the type of data available in each case. Details on how these estimates are produced are presented in the relevant sections of each chapter of this report.

1.4 Structure of National Study Report The National Evaluation Report on Greece is structured according to the guidelines provided by the central study team for all national studies in line with the terms of reference.

Chapter 2 provides an Overview of the country situation, with special emphasis on the status of implementation of the EU environmental acquis and of Structural and Cohesion Funding during the 2000-2006 programming period, with respect to the five study Fields. Keynote observations on Horizontal Issues across the five Fields are included, as well as a presentation of the key policy and programming documents upon which the study is based.

Each of the following Chapters 3 to 7 focus on each of the study Fields: Water Supply, Waste Water Treatment, Municipal Solid Waste Management, Renewable Energy and Natural Risk Management. All Field Chapters have an identical structure, each including three (3) main sections:

1. A presentation and assessment of the Current Situation in the study Field, including the overall state of provision, the state of physical infrastructure, and the pricing and user charges policy in place as well as any future plans towards increased cost recovery.

2. A detailed Analysis of Future Needs in the study Field. This section starts by a review of the policy objectives and targets for the 2007-2013 programming period as formulated in the key policy and planning/programming documents available at the time of undertaking this study. The section further presents the key factors determining the future demand in the Field and identifies demand trends (or forecasts, where available) to the year 2013. There follows a detailed analysis and critical assessment aiming to identify in qualitative and, where possible, in quantitative terms the physical infrastructure investment needs in the Field, including an identification of the framework factors affecting these needs. This section concludes with an estimation of the indicative scale of the financial investment that is required to address the identified needs during the programming period 2007-2013.

3. The Assessment of Filed Priorities section applies the evaluation study central methodology to rank physical investment priorities within the Field, the prevailing criterion being compliance with EU legislative requirements (environmental acquis). Furthermore, the indicative financial investment requirement identified in the Needs Analysis section is reviewed and revised to take into consideration: alternative funding sources (e.g. market schemes), the scope to increase user charges, and the administrative capacity to deliver the investment.

Chapter 8 on Assessment of Priorities Across Fields establishes the priorities across the five Study Fields, both as these result from the Needs Analysis as well as by applying the Multi-Criteria Analysis proposed by the central study methodology.

Chapter 9 presents the Summary Conclusions on needs and priorities, as well as a summary of the key issues for consideration by the European Commission in reviewing the Member State 2007-2013 programme proposals.

A series of Annexes complement data and information reviewed in the main report:



Annex A includes data on the Structural and Cohesion Fund investment per Field for the 2000-2006 programming period, both planned investment and actual (as at December 2005) expenditure.

Annex B presents the institutional context, i.e. the breakdown of policy and operating competences, and related issues for each Field.

Annex C includes summary data tables on available physical indicators per Field.

Annexes D and E present data on user charges for the Drinking Water Supply (including Sewerage) and for the Renewable Energy Fields respectively.

The Reference List provides details on the documentation consulted in the course of this study, general and field-specific, as well as on the competent authority officials interviewed.



2 OVERVIEW AND HORIZONTAL ISSUES

2.1 Country Overview 2.1.1 General Facts of the Country

Greece has a total surface of 132 thousand square km, with a 16 thousand km long coastline. Islands comprise about one fifth of this surface (25 thousand square km of nearly 3000 islands, not all inhabited), while forests cover 22% of the country area. A total of 239 sites totalling 27,641 sq. km. and representing 21% of total country surface are designated Sites of Community Importance (SCI), while 151 sites of 13,703 sq. km. are designated Special Protection Areas (SPA) within the framework of Natura 2000 (Source: GR Barometer June 2005).

The population of just over 11 million in 2005 (National Statistical Service estimate) is highly concentrated in the broader urban agglomerations of Athens (Attica Region) and Thessaloniki (Central Macedonia Region) - the Attica Region concentrates 35.6% of the total number of households in 2.9% of the total country surface. The country’s population increased by 7.2% during the decade 1991-2001, that is an average annual increase of 0.6% (National Statistical Service - NSS data).

The average macro-economic characteristics of the country have improved during the 1999-2004 period with growth rates significantly higher than other Member States (MS). The annual GDP growth rate rose form 2.1% in 1995 to 3.4% in 1999, while the annual average for the 2000-2004 period was 4.5% (compared to an EU average of 2%). Real GDP growth was 4.7% in 2004 and was maintained at 3.6% in the first semester of 2005 (post-Olympic Games). There has been a steady increase in investments as a percentage of the GDP, including private investments in R&D, and a reduction of the gap with EU MS regarding per capita income. (Source: EUROSTAT, NSS, Ministry of Economy and Finance).

However, the employment rate in 2004 (% of active population) was 59.4% and continued to be one of the lowest in the EU. Also, regional disparities within the country remain, with significant differences between regions as regards unemployment rates and per capita gross added value, while 60% of all new business units are established in the Attica Region.

Indicatively, the regional breakdown of GDP growth in 2002 which for Greece overall was 3.8% was: for Attica 4.0%; for East Macedonia & Thrace 2.1%; for the Aegean Islands & Crete 4.1% (Source: EUROSTAT, NSS). Three (3) of the 13 Greek Regions (all thirteen under Objective 1 status in the past and current programming periods) - Attica, Central Greece and the Southern Aegean - concentrating 43% of the total population also concentrate most of the wealth. The four (4) Regions of Western Greece, Epirus, Thessaly and Eastern Macedonia & Thrace (22% of total population) have a GDP per capita that is still lower than 60% of the EU-15 average. (Source: Information Report 2005 on Structural Interventions in Greece: Policies, Results, Perspectives, Ministry of Economy and Finance).

Two of the thirteen Greek Regions, Continental Greece and the Southern Aegean, have a GDP per capita that is now higher than 75% of the EU-15 average and have been designated “phasing in” (Objective 2) transition status for the 2007-2013 programming period. An additional three Regions, Attica, Central Macedonia, and Western Macedonia, have a GDP per capita that is higher than 75% of the EU-25 average, but remains lower than 75% of the EU-15 average (“phasing out” transition regions for the 2007-2013 programming period). (Source: Third Guideline Document for the Elaboration of 2007-2013 Operational Programmes, Ministry of Economy and Finance, June 2006).

Table 2.1 General Country Indicators



Indicator Value and Latest Year Trends (Indicative Years and/or Regions)

Area of country 131,940 sq. km. (18.9% islands) Regional breakdown: Attica 3,808.2 (2.9%); Eastern Macedonia & Thrace 141,157.9; Aegean Islands & Crete 17,458.4

GDP (million Euro at market prices)

161,353 (2004) 167,162 (2005, NSS estimate)

81,812 (1995) 100,505 (1998) 109,391 (1999) 117,731 (2000) 127,311 (2001) 136,832 (2002) 148,930 (2003)

GDP per capita (Euro at market prices)

15,119 (2004, NSS estimate) 8,452 (1995) 10,058 (1998) 10,829 (1999) 11,282 (2000) 11,992 (2001) 12,893 (2002) 13,984 (2003, NSS estimate)

Population 11,040,050 (2004, NSS estimate) 11,082,751 (2005, NSS estimate)

10,595,074 (1995) 10,931,206 (2000) 10,968,708 (2002) 11,006,377 (2003)

Number of households 4,125,500 (2004) Regional breakdown: Attica 1,467,600 (35.6%); Eastern Macedonia & Thrace 231,000; Aegean Islands & Crete 420,100

3,719,700 (1999) 3,831,400 (2001, EUROSTAT) 3,664,392 (2001, NSS census) 3,876,500 (2002, EUROSTAT) 3,965,000 (2003, EUROSTAT & NSS)

Average household income (Euro)

18,001 (2003, NSS data)

Unemployment rate (%) (ILO definition)

10.5% (2004) 12.1% (1999) 11.4% (2000) 10.8% (2001) 10.3% (2003)

Sector employment Agriculture: 544,000 Industry: 616,900 Construction: 350,000 Services: 2,802,000

Total Employment: 4,313,200 (2004)

Sources: EUROSTAT; Greek National Statistical Service (NSS) where indicated



2.1.2 Macroeconomic Trends and Forecasts

2.1.2.1 Population Growth Data and Forecasts as applied for the methodological requirements of this study The average annual population growth which stood at 0.65% during the 1991-2001 decade, decreased to 0.3% during the period 1999-2005. The NSS main scenario on population growth projects a 1.45% increase by 2010 over the year 2005 (i.e. 11,244,118), that is an annual average of 0.24%. A further 0.88% increase over 2010 is projected for the year 2020 (i.e. 11,342,924), that is an annual average growth of 0.08%.

NSS population projections take into account fertility rate, male and female life expectancy at birth, and net migration scenarios.1 Overall, the rate of population growth is in substantial steady decline primarily due to a low and declining fertility rate (estimated at 1.29 in 2004, forecast to further decline). On the other hand, its impact on population growth is partly set-off by the steady inflow of migrants (net projection 40,000 per annum).

On the basis of NSS projections, it is reasonable and realistic to estimate the country population in the year 2013 at about 11.27 million, that is an absolute increase of approximately 140,000 during the period 2007-2013.

For the environmental fields of interest to this study (details provided in the relevant field-chapters of this report), where regional management and/or investment plans are available, notably with respect to solid waste and wastewater treatment, these take fully into account population growth historical data and NSS projections at local level (NUTS III), including seasonal variations due to tourist inflow. Seasonal population increase due to tourism is a most significant factor affecting investment decisions notably in the water supply, wastewater treatment and municipal solid waste sectors.

2.1.2.2 GDP/GVA Growth Data and Forecasts as applied for the methodological requirements of this study

Following GDP growth rates substantially higher than the EU average during the period 2000-2004 (4.5% annual average), the momentum was maintained in the year 2005 (post-Olympic Games period) with a 3.6% GDP increase (Source: Ministry of Economy and Finance). Annual average GVA growth over the same period (2000-2004) according to Cambridge Econometrics (CE) was 4.3%, and dropped to 2.3% in 2005.

The government’s official National Reform Programme for 2005-2008 foresees an average GDP growth of 3.9% annually (2006: 3.8%; 2007: 3.8%; 2008: 4.0%) supported by a series of structural reforms aimed to increase productivity, private investment and employment, and decrease unemployment rate to 8% (from 10.5% in 2004). The alternative (“less optimistic”) official scenario for the same period is an annual GDP growth of 3.4% during the same period, with a decrease of unemployment to 8.5% (and a projected further decrease to 7.3% by 2010). The May 2005 OECD forecast is for a 3.6% average GDP growth during 2004-2010. CE GVA projections for the period 2007-2013 indicate an annual average of 2.75%, with higher rates during 2011-2013.

On the basis of the above, given the anticipated impact of the government’s 2005-08 structural reform policy, in combination with the continued EU Structural and Cohesion Funds impact over the next programming period, it would be reasonable to assume for the

1 The NSS main population projection scenario presented above is more “optimistic” compared to the population forecasts provided by Cambridge Econometrics for the purposes of this study – CE forecasts a 25,800 net population decrease during the period 2007-2013. However, CE figures on historic data are lower as compared to both NSS and Eurostat population figures. Also, NSS takes explicitly into account net migration scenarios.



purposes of this study an annual average GDP growth of no less than 3.0% during the 2007-2013 programming period.

The analysis of historic data and CE projections, confirms that the economic growth and employment driver will continue to be the services sector. The agricultural sector is in steady decline also in terms of employment, while manufacturing industry is likely to show small (less than 1%) but steady annual growth (albeit employment decrease) throughout the next programming period. This growth trend is anticipated to impact significantly on the investment demand for the sectors of interest to this study, most critically on the energy sector, but also on the municipal solid waste and wastewater treatment sectors.

2.2 Status of Implementing the EU Environmental Acquis The main environment-related EU Directives concerning the environmental fields of interest to this study, have been all transposed into national legislation. Nonetheless, and in spite of substantial Structural and Cohesion Funds directed towards the implementation of the EU environmental acquis in these fields over past and current programming periods, critical problems are faced – most notably with respect to municipal solid waste management and wastewater treatment – due to significant delays and problems in the implementation of legislative requirements (details are provided in the relevant field-chapters of this report).

Depending on the case, delays in implementation relate to inefficient and non-integrated planning, complex or inappropriate institutional context/structures and/or heavy administrative procedures, high costs, and in some instances public opposition to location plans (notably with respect to landfill sites) also in the absence of national spatial planning. Furthermore, it is widely acknowledged that there is no marked progress with respect to the integration of the environment into sectoral policies, nor with respect to the implementation of the Polluter Pays Principle (deadline for transposition of Directive 2004/35 is April 2006). These are key issues that the competent national authorities adhere to address as a priority of environmental strategy for the next programming period.

In the year 2005 alone, Greece was taken to the European Court of Justice for a total of seven cases concerning incompliance with EU environmental legislation. In addition, nine such cases are pending from previous years for non-implementation of environmental policy and related infrastructure works. Many of these cases concern the uncontrolled disposal of solid waste (including disposal in areas designated for environmental protection). A notable conviction resulting into economic measures being enforced concerns the illegal waste disposal site in Kouroupitos in the Region of Crete, in 2000, for which Greece was ordered and paid for a period of nine months a daily fine of €20,000. The most recent conviction by the ECJ (C502/03) in October 2005 on failure to comply with Directive 91/156 concerns a total of 1125 illegal waste disposal sites.

Full compliance with the Urban Waste Water Treatment (UWWT) Directive has also not been achieved within the Directive’s required deadlines. An ECJ conviction in June 2004 (119/02) concerns the case of the Thriassio Pedio (Priority A settlement) in the Attica Region for absence of appropriate collection and secondary treatment before discharging wastewater into the Gulf of Elefsina. Current investment effort aims to achieve compliance for Priority A and all but five Priority B settlements by 2008, while the outstanding Priority B and C settlements will be the top investment priority in 2007-2013 programming.

In the case of water supply and drinking water quality the relevant EU Directives are applied and enforced. Progress is also being made to develop the necessary institutional context required for harmonisation with the Water Framework Directive which was transposed into national legislation in 2003. A Joint Ministerial Decision recently passed in December 2005 provides for the establishment and development of the administrative bodies and structures (i.e. national water council, central water agency, regional water directorates per river basin districts) for water management in line with the WFD requirements.



With respect to renewable energies, Greece has fully committed to the target of 20.1% renewable share in total electricity consumption by the year 2010, as proposed in EU Directive 2001/77, and annual situation reports are provided on progress towards target.

The management of natural hazards is not directly subject to EU legislative requirements, with the exception of flooding risk management which is expected to be addressed through the river basin management plans linked to the implementation of the Water Framework Directive. In Greece, policies and measures in this field are developed per type of hazard, with competences being divided between different authorities (national and regional levels) depending on individual hazard and also on level of emergency response. There is an acknowledged need for an integrated approach and strategy to natural risk management at national level.

2.3 Environmental Policies, Strategies and Planning The integration of the environment into all sectoral policies is identified as a key strategic objective of national policy according to the Government’s National Reform Programme for Growth and Jobs 2005-2008. The effective implementation of this objective remains a key challenge to be addressed.

To date, the formulation of environmental policy in Greece is first and foremost EU legislation driven. For the environmental sector at large and for the environmental fields of interest to this study in particular, the only quantitative objectives and systematic targets set (details provided in the relevant field chapter of this report) are those prescribed by the relevant EU directives as appropriately transposed into national legislation. Compliance with the environmental acquis (as per legislative requirements) is the determining factor in identifying investment priorities and types of projects. The recent (June 2006) guidelines on the preparation of operational programmes (regional and thematic) for the next programming period that have been issued by the Ministry of Economy and Finance confirm this approach and set as a priority the so-called “inflexible obligations” (i.e. legislative requirements) for the environment sector. Of the fields of interest to this study, this principle is of particular relevance to the water management, wastewater treatment and municipal solid waste (Annex III of referenced Guideline document).

EU funding through the Cohesion and Structural Funds has been the main financial source for the implementation of environmental policy and environmental legislative requirements in Greece for all regions. In this sense, environmental planning is fully integrated into regional development planning aimed to promote regional competitiveness and convergence. This applies equally to past, current (2000-2006) and future (2007-2013) programming periods.

In particular with respect to renewable energy, this is a prominent component of energy policy in Greece, which in turn is an integral part of national development policy under the competence of the Ministry of Development. Supporting instruments (both national and EU) are developed and implemented as part of regional development strategy. Furthermore, renewable energy policy is inscribed in the broader policy context of energy market liberalisation which is currently in progress in Greece.

The following sections discuss the key official policy documents available at the time of undertaking this study that provide the strategic directions for 2007-2013 environmental planning. Field-specific planning documents (such as the regional solid waste management plans) are presented and discussed in the relevant field-chapters of this report.

2.3.1 National Reform Programme 2005-2008

Current development policy in Greece is based on the government’s National Reform Programme for Growth and Jobs which covers the period 2005-2008 and sets the pace for growth to the year 2010. The programme recognises sustainable development and the Lisbon agenda as the guiding strategic directions of national policy. Both the 2000-06 Community Support Framework (CSF) and the expected 2007-13 National Strategic



Reference Framework NSRF contribute to the National Reform Plan, and they both directly contribute to the revised Lisbon agenda (the proportion of current CSF funds directly or indirectly linked to Lisbon targets is estimated at 46%).

According to the National Reform Programme, the consultation for the preparation of the NSRF focuses on seven (7) priority axes at programming level. One of the priority axes is sustainable development, with special emphasis on: basic environmental infrastructure on solid waste and wastewater management; civil protection and risk prevention; protection and promotion of natural environment; quality of urban and built environment; environmentally friendly urban transport; entrepreneurship in the area of the environment; rational management of natural resources; spatial planning.

2.3.2 Status of 2007-2013 Programming

As at May 2006 (end of field research for this study), the Greek National Strategic Development Plan for 2007-2013, aimed to comprise the basis for the NSRF 2007-2013, was not comprehensively available. Both documents, the preparation of which is coordinated by the Ministry of Economy and Finance with input from all other competent Ministries and Regions, are expected to be completed in July 2006 with respect to the strategic part, while the operational programme proposals (including investment needs and financial breakdowns) both at regional and sectoral/thematic levels are expected to be completed in November 2006.

The programming guidelines issued by the Ministry of Economy and Finance (Third Guideline Document, June 2006) identify the “environment and sustainable development” as one of the five main priority axes of the 2007-13 programming period, to be implemented both through one sectoral/thematic operational programme as well as through the regional operational programmes. The guidelines indicatively earmark a total of 1,800 million Euro for the 2007-13 Operational Programme on Environment and Sustainable Development Additional funds on this strategic priority can be allocated through the Regional Operational Programmes, albeit relatively small given that ROPs cover all development priorities. Funding of investment in renewable energy would be additional and covered through the priority axis on “competitiveness and entrepreneurship”.

The key policy document publicly available identifying strategic objectives for the 2007-13 programming period is the National Strategic Development Plan for the Environment and Sustainable Development issued by the Ministry of Environment, Planning and Public Works (YPEHODE) in February 2005 and an updated version in December 2005. The document (presented in detail below) has provided the basis for the relevant “thematic” national development conferences (consultation procedures) informing the elaboration of the NSDP.

2.3.3 National Strategic Development Plan for the Environment Sector for the Period 2007-2013

The December 2005 Ministerial (YPEHODE) document on “Environment and Sustainable Development Priority Axis: Synopsis, Objectives, Vision” that was prepared for the Second National Conference on the 2007-2013 NSDP, identifies the key environmental development planning objectives. It does not, however quantify objectives at this stage, nor does it provide an indication of scale of needed investment or hierarchy of needs.

The environmental development intervention priorities according to above document with respect to the fields of interest to this study are as follows:

• Municipal Solid Waste: completion of the infrastructure necessary for attaining the targets set by legislation (Directive 99/31). Priorities: reduction in quantity of waste; selection at source; recycling; treatment of biodegradable residue; disposal at sanitary landfills; completion of reclamation of uncontrolled disposal sites.

• Water Resources Management: implementation of Framework Directive (60/2000). Priorities: activation of the regional and central water services/agencies; elaboration and implementation of river basin management plans; monitoring of water quality on the basis



of specific indicators and parameters for all types of resources – surface, underground and bathing waters; protection and replenishing of aquifers from nitrate pollution and excessive agricultural use; introduction of rational water pricing policy for agricultural, industrial – energy use and for household consumption.

• Waste Water Treatment: implement requirements as these have been identified for compliance with relevant legislation (Directive 91/271).

• Renewable Energy Sources: simplification of licensing procedures for the development of notably solar, wind and biomass energy; contribution to reduction of Greenhouse Gas emissions objectives.

• Civil Protection - Prevention of natural and technological disasters: upgrading civil protection services and planning methods and tools.

Environmental development intervention priorities according to above document in areas indirectly related to the fields of interest to this study include:

• Protection and Upgrading of Natural Environment: support the full-scale operations of the Natura 2000 Management Bodies through the development of relevant environmental and management studies, infrastructure and equipment for monitoring environmental parameters, etc.

• Development of a National Environmental Information Network as a key tool to enhance cooperation between the various competent authorities / government departments as well as public access to environmental information.

Additional environmental development intervention priorities with respect to other environmental fields (i.e. not addressed in this study) include:

• Strategic Environmental Assessment (Directive 2001/42) as transposed into national legislation (L. 3010/2002) will require new specifications for the issuing of permits of all types of public and/or private investments of the 2007-13 NSRF.

• Reduction of Air Pollution: incentives, tax deductions, etc for technological interventions for the reduction of air pollution; assessment, control and reduction of noise pollution in urban and tourist centres. (The mapping of zones is in progress and action plans for thirteen cities is completed or in progress).

• Hazardous Waste: completion of the National Plan for Hazardous Waste Management; increase capacity for hazardous waste treatment through promotion of private investment interest; reclamation of land affected by industrial hazardous activity notably where this is near urban areas.

• Protection and Upgrading of Urban Environment: development of a National Plan with explicit distribution of financial resources between central, regional and local authority levels, and private sector investments.

• Ecological Production and Consumption: support introduction of new ecological production technologies and methods; integration of environmental considerations in other sectoral policies, notably industrial and agricultural policies, including eco-labels and environmental management systems in tourism, industrial, agricultural and transport economic activity.

• Environmental Awareness and Education Activities.

2.3.4 National Spatial Plan

A National Spatial Plan is currently being developed under the responsibility of the Ministry YPEHODE, as well as individual Spatial Plans specific to Renewable Energy Sources (RES), Tourism, Industry, Mountainous and Island areas. This is a key initiative as it promotes for the first time a comprehensive and integrated approach to spatial planning,



rationalises and ranks development priorities, and clarifies the legal framework with respect to the location of activities and land uses so that economic growth, environmental protection and social cohesion are achieved. The National and Specific Spatial Plans are expected to come into force by the end of 2006.

2.4 Overview of Environmental Expenditure – Structural and Cohesion Fund Support The National Centre for the Environment and Sustainable Development estimates total investment in the environmental sector (i.e. all fields) at 1.4% of the GDP. A detailed analysis on the breakdown of this investment figure is not available.

Public sector environmental expenditure is realised mainly through the EU financial instruments. For the 3rd Community Support Framework (programming period 2000-2006), the total planned budget on environmental interventions is €6,024 million, representing 11.7% of the total 3rd CSF budget (including Structural and Cohesion Funds). The EU contribution to this budget is 60%. Private fund contribution is estimated at 14.3% (Source: Deloitte study, 2005).

The above study reports that 80% of this budget concerns projects in four (4) sectors: wastewater treatment (22.7%); water management (22.4%); renewable energy sources (24.6%); and solid (not exclusively municipal) waste (10.4%). The fields of interest to this study, therefore, already concentrate the highest share of Structural and Cohesion Funds assistance relatively to other environmental fields.

In addition to EU funds, the National Development Law is a key financial instrument aimed at providing subsidies to private sector productive investments. The Law actually concerns all sectors of the economy and has a strong regional focus. From the environmental sectors of interest to this study, this financial instrument concerns primarily the renewable energies sector, as there is no private sector involvement in any of the other fields.

Generally, investment efforts during the 2nd and 3rd CSFs were systematically concentrated in the fields of solid waste management and wastewater treatment, reinforcing investment in renewable energies, natural environment preservation, and environmentally sustainable cultivation methods. Environmental investment in the regions contributed significantly in raising the quality of life of the inhabitants and in developing quality of infrastructure comparable to that of the urban areas (Source: Directions for the 2007-2013 NSDP with respect to the Environment Sector, YPEHODE, February 2005).

For the fields of interest to this study, 2000-2006 investment is realised through all thirteen (13) Regional Operational Programmes (ROPs), through mainly three (3) sectoral/thematic Operational Programmes (i.e. OP Environment; OP Rural Development and Restructuring; OP Competitiveness), through Cohesion Fund environmental projects, and to a lesser extent (in terms of size of investment) through the Community Initiatives Urban and Interreg.

The following Table 2.2 presents planned expenditure for the 2000-2006 period in the fields of interest to this study.



Table 2.2: Structural Assistance in Study Fields - Planned Investment 2000-2006 (in million Euro)

Environmental Fields of Intervention Total Public Investment

EU Assistance

National Public Funds

Structural Funds

Urban and Industrial Waste (including hospital & dangerous waste)

360.7 267.4 93.3

Waste Water Treatment (Sewerage and Purification) 353.1 264.9 88.2

Drinking Water (collection, storage, treatment & distribution)

394.4 276.6 117.8

Agricultural Water Resources Management 657.6 481.0 176.6

Renewable Energy Sources Infrastructure (solar, wind, hydro, biomass) - Production & delivery

51.0 27.7 23.3

Energy Productive - Environment friendly technologies, clean & economical energy technologies (support to private investment)

581.2 304.6 276.6

Forestry - Restoring forestry production potential damaged by natural disasters and fire and introducing appropriate prevention instruments

119.0 89.3 29.7

Forestry - Improving and maintaining ecological stability of protected woodlands

1.6 1.2 0.4

Rural - Restoring agricultural production potential damaged by natural disasters and introducing appropriate prevention instruments

50.0 34.7 15.3

Rural - Preservation of the environment in connection with land, forestry, and landscape conservation and the improvement of animal welfare

112.4 81.9 30.3

Total Structural Funds 2,681.2 1,829.5 851.7

Cohesion Fund

Drinking Water (collection, storage, treatment and distribution)

687.2 519.7 167.5

Environmental protection (flood protection, desertification, affrestation, Natura 2000, other)

64,3 48.2 16.1

Mixed water and waste water projects 253.7 193.7 60.0

Sewerage and purification 653.8 500.6 153.1

Urban and industrial waste (including hospital and dangerous waste)

508.8 382.8 126.0

Total Cohesion Fund 2,167.8 1,645.2 522.7

Grand Total 4,849.0 3,474.7 1,374.4

Source: EC, DG REGIO-DW

Internal redistribution of resources in the OP Competitiveness (revised in December 2006) increased planned investment in renewable energy sources (for details, see Annex A to this report). A similar redistribution in the OP Environment as well as in the Regional OPs tends to increase support to actions concerning the reclamation of uncontrolled (illegal) waste disposal sites.



The data in Table 2.3 below refer to actual expenditure (completed, in-progress and/or approved projects) as of December 2005 for Structural Fund projects. They have been aggregated on a project-by-project basis according to data available in the Integrated Information System (Ergorama) of the Ministry of Economy and Finance. Regional breakdowns and details on the projects per field are presented in Annex A of this report.

Table 2.3 Structural Fund Projects in Study Fields - Actual Investment as at December 2005 (in million Euro)

Structural Fund Programme

Municipal Waste Management

Water Supply

Waste Water Treatment

Renewable Energies

Irrigation and Flood Prevention

Forests∗

ROPs (13) 64.7 248.0 488.9 - 381.7 45.7

OP Environment 25.6 2.5 48.5 - 1.5 -

OP Rural Dev. - 11.6 - - 288.3 0.3

OP Competitiveness - - - 967.5 - -

Urban (Perama) 0.2 - - - - -

Interreg III A (4 Ops) - - - - - 21.3

Total Structural Funds 90.5 262.1 537.4 967.5 671.5 67.3

Sources: For Renewable Energies, Ministry of Development, OP Competitiveness Managing Authority, Note 13/03/2006. For all other Fields, Ministry of Economy and Finance, Integrated Information System “Ergorama”, update December 2005. Structural Fund project data processed and aggregated by environmental field for the purposes of this study.

∗ Note: Forests category includes investments in fire prevention and forest-area water resources management.

With respect to environmental Cohesion Fund projects, actual expenditure in 2005 amounted to 686.7 million Euro (Source: Cohesion Fund Third Monitoring Committee Report, Ministry of Economy and Finance, 12/07/2005). For the most part, environmental Cohesion Fund projects concern water supply, wastewater treatment (including sewerage) and solid waste management. A field-specific analysis of a sample of 55 CF environmental projects is included in Annex A to this report.

2.5 Institutional and Administrative Capacity Issues With the exception of renewable energy, all the other environmental sectors of interest to this study fall exclusively within the responsibility of the public sector, with competences shared between central, regional and local authorities. In certain cases (such as for water supply, sewerage, and wastewater treatment), the operators constitute publicly owned S.A. enterprises. (Details on institutional competences are provided in Annex B to this report).

2.5.1 Public Private Partnerships

After a long period of consultation, the legislative framework for Public Private Partnerships (PPP) was established in September 2005, introducing several provisions of EU Directive 2004/18. The law was an institutional prerequisite to proceed with and promote PPPs aiming at a better use of public financial resources and at the delivery of high quality projects. This is expected to have a structural impact in the Greek public sector investment policy, including the environmental sectors. The potential for such prospects is discussed in the field-specific chapters of this report.

2.5.2 Fund Absorption Capacity

The reported absorption capacity rate for both Cohesion and Structural Fund environmental projects during the 2000-2006 programming period remains quite low.



With respect to Cohesion Fund, the Third Monitoring Committee Report issued in July 2005 reports an absorption rate of 31% for a total of 87 environmental projects, most of which concern infrastructure investment in water supply, wastewater treatment and solid waste management. In fact, the Report indicates a mere 14% absorption rate for the 71 “new” CF II projects – that is, projects that are not continuing from the previous programming period (CF I). By October 2005, the overall absorption rate was reported at 37% according to the Information Report on Structural Interventions in Greece issued by Ministry of Economy and Finance.

With respect to the Operational Programme on the Environment, the absorption rate reported in the above cited Ministerial Report is 40.4%, the same as that indicated by the Programme’s Interim Evaluation Report. This percentage refers to legal commitments (as compared to actual expenditure which is reported at 26.1%).

Furthermore, the issue of the water supply and sewerage municipal operators’ (DEYA) capacity to absorb public credits is a widely acknowledged problem. The Association of Municipal Water and Sewerage Companies (EDEYA) reports that this problem is caused primarily by heavy bureaucratic and administrative procedures. (Source: EDEYA, General Congress Report 2005).

There are no issues of absorption capacity with respect to renewable energy sources (for details on current expenditure, see Annex A of this report).

2.5.3 Institutional Issues in Future Planning/Programming

This study identifies a number of additional institutional and administrative capacity issues for each study field, that are judged to impact significantly on the ability to realise the required investment over the next programming period (2007-2013) and achieve progress towards objectives and targets. These are discussed in detail as part of the needs analysis in each field-specific chapter of this report, highlighting their potential impact and identifying them as key priorities to be addressed. They include:

• Water: Implementation of the Water Framework Directive depends on the operational capacity of the regional water management services only currently being established. Also, the elaboration of regional (river basin) water management plans is critical in order to determine physical planning priorities and targets for the next programming period.

• Wastewater Treatment: Planning with respect to priority C settlements (in line with the UWWT Directive requirements) currently in progress, is critical to identify physical and financial investment priorities and targets for the next programming period.

• Municipal Solid Waste Management: Pending legislation for the organisation of local operators and for requirements with respect to the pricing policy.

In addition, a number of identified weaknesses effectively constitute horizontal issues for all environmental sectors:

• There is need to improve the quality of environmental data as well as their systematic collection, central processing, management, and public access. The establishment and continuous updating of a set of established environmental indicators is of primary importance, as is the need for mechanisms/services for the systematic on-going monitoring of indicators relating to specific targets defined by legislation. A first systematic attempt on producing a set of environmental indicators was undertaken by the National Centre for the Environment and Sustainable Development in 2003. This effort has not been followed up and no updates are available.

• There is need to enhance the control mechanisms for the systematic control of compliance with relevant legislation in all environmental sectors.

Finally, the key challenge is to undertake the necessary institutional or other reforms required to achieve the development of comprehensive environmental policy which moves



away from the mere legislative mentality to a true integration of environmental planning with other sectoral policies as well as with the overall national and regional development strategy. This entails administrative reforms to enhance cooperation and synergies between the many authorities (government departments, central, regional and local services and operators) with competencies in the environmental sector.



3 WATER SUPPLY

3.1 Current Situation This section provides a brief analysis of the current state of service provision, demand, supply and infrastructure in the water sector. Details on investment through the Structural and Cohesion Funds are included in Annex A to this report. The institutional context and competences are presented in Annex B. Annex C includes a summary of relevant physical indicators.

It is noted that statistical data on water supply and consumption as well as related costs (unit investment and operating costs) are not centrally (i.e. at national level) collected nor systematically processed (no official indicators available). The data identified in the course of this study are, therefore, not adequate to inform a quantitative assessment of the current state of infrastructure. Equally, they are not adequate to inform a quantitative assessment of future needs and investment priorities. Thus, the analysis undertaken in the relevant sections is mainly qualitative.

3.1.1 Current State of Provision

Sources of water supply in Greece include both surface and ground waters: shallow groundwater, karstic, lakes and rivers. 80-85% of freshwater resources are in the form of surface waters. No desalination of seawater is practiced (only one such unit has been identified), and this may be a field with growth potential particularly in the island regions that are not self sufficient in water resources.

The proportion of annual renewable freshwater resources stored in reservoirs is 17% as per year 2001 (Source: European Environmental Agency). Greece is generously endowed with freshwater resources (as per the United Nations CSD 12 Country Profile Report) and overall there are no particular issues regarding availability of supply. However:

• There are regional variations due to climatic and geomorphological conditions, with demand being maximised during the dry (summer) period in certain areas due to tourism peaks as well as for irrigation purposes.

• Furthermore, there are serious issues of rational/sustainable management of water use (notably in agriculture but also in industrial and household use, and high water losses).

With respect to regional variations in particular, the Aegean islands have insufficient water resources and drinking water is transported from the mainland. Rainwater retention is also practiced in these areas. The most serious shortages occur during the tourist season (which coincides with the dry period).

Specific issues and quantitative indicators at regional level are expected to be identified once the drafting of the Regional Water Management Plans (at river basin level as per requirements of Water Framework Directive and relevant national legislation) is completed.

3.1.2 Drinking Water Demand

Total water uptake in Greece in the late 1990s amounted to 8.5 billion m3 (Source: EKPAA, Environmental Signals, 2003). Drinking water demand accounts for 13% of total water demand. Specifically, household demand accounts for 11% of total, while industry accounts for 2%.

With respect to the other uses, the biggest consumer of water is by far the agricultural sector (water use for irrigation), 86% of total supply, while the energy sector consumes only about 1%.

Current drinking water supply meets demand. No issues are identified in this area.



Water capacity and supply is monitored on a daily basis at natural water source level (lakes, rivers, groundwater), in intermediate reservoirs and in production plants. The supply monitoring system is comprehensive and able to meet promptly variations in demand.

Overall at national level, maximum existing capacity is much higher than existing demand. In the Attica Region, EYDAP S.A. (Athens Water Supply and Sewerage Company) reports 1.1 million m3 average daily consumption, while the total maximum capacity of its four production plants is nearly double this amount (1.9 million m3).

The European Environmental Agency (EEA) reports that Greece is comparatively a low water-stressed country: WEI=24 in the late 1990s. Also, it reports a trend, over the same period, for reduced energy and urban use of water. (Source: EEA, Europe’s Water: An Indicators’ Based Assessment, 2003).

3.1.3 Drinking Water Quality

Drinking water is of generally good quality (complying with relevant European standards on potable water). The UN CSD 12 Country Profile (2004) reports drinking water quality not satisfactory for only 2% of the population, due to marine water intrusion in coastal aquifers.

In the Attica Basin in particular, raw water (processed by EYDAP) is of high quality, certified according to Directive 75/440 and classified as A1 category. EYDAP meets treatment standards of A2 category to provide top quality drinking water.

Pressures on the quality of natural water sources arise from agricultural use. As per the relevant EU legislation requirement (91/676/EC transposed into national legislation by Joint Ministerial Decision 195652/1999), seven “vulnerable zones” have been identified with respect to nitrogen pollution from agricultural run-offs and relevant Action Plans are in force. Wastewater discharges also create intense points of pressure on natural water sources, and this issue is being addressed through large investment in the construction of wastewater treatment plants in line with relevant EU legislative requirements (see next chapter of this report).

The EEA does not report critical issues with nitrate pollution in Greece (Source: EEA, Europe’s Water: an Indicator Based Assessment, 2003): only 9% of water samples indicate frequent to very frequent high nitrate concentration in groundwater sources. Similarly, the 2003 Environmental Signals Report of the National Centre for the Environment and Sustainable Development concludes that the surface water resources are not seriously threatened by nitric pollution, although deviations from quality standards are recorded at local level. It furthermore notes that deviations are more important in the case of phosphoric compounds and the requirements in chemical oxygen demand. However, more systematic and reliable data are expected in the near future through: (a) the National Water Monitoring Network; (b) programmes in progress aiming to investigate soil nitrate pollution in arable land and quality of ground water sources (both projects are currently being financed through Structural Funds).

Monitoring of drinking water quality is carried out by the Ministry of Health and its regional laboratories. Municipal water supply companies undertake extensive water quality testing as per legislative requirements.

EYDAP reports that 10,000 samples are tested annually for microbiological and chemical parameters in its accredited laboratories, and a percentage of these is further tested for heavy metal concentrations. The samples cover the entire water supply distribution network. Also, 20,000 samples are tested annually on site, throughout the distribution network, for chlorine residue. In addition, EYDAP undertakes full relevant tests on 300 samples annually of unprocessed water from its natural sources (mainly the 4 lake reservoirs supplying the Attica region, but also from groundwater sources intended primarily for back-up purposes). Similarly, EYATH reports 2000 samples tested per annum for microbiological and chemical parameters; 5% of those are further tested for heavy metal concentrations.



There are two key issues in the current state of infrastructure that impact on water quality:

• Old and decaying distribution network infrastructure (piping) in need of replacement. This is an area where current investment effort is concentrated, but which will require further investment in the future.

• The drinking water quality testing laboratories of the Water Supply Municipal Companies (DEYA) are not all accredited (i.e. proof of technical competence) as required by relevant legislation. There are several notable exceptions that have received or are receiving funding through the current programming period. However this area represents a need for future investment: accreditation will improve their testing infrastructure, their personnel competence, the credibility of the results and also their ability to provide statistical data on water quality issues.

3.1.4 State of Infrastructure

Overall, the current infrastructure meets demand; it is estimated that 98% of the country population is connected to the metered water supply system. However, there is a significant need for drinking water supply network upgrade and/or replacement (piping but also pumping and water tanks) due to ageing and decay. This problem is particularly prominent in the rural areas as well as in the old city centre areas and, therefore, affects a comparatively lower percentage of the population. It is nonetheless a significant problem that is being addressed through financial assistance during the current programming period. It appears that it will continue to require further investment efforts in the near future. The poor state of ageing infrastructure impacts on water quality, increases operational and maintenance costs, and relates to the major problem of water losses.

Water losses are reported to far exceed the EU-15 average of 18%. EYATH S.A. (Thessaloniki Water Supply and Sewerage Company) reports 45% of water losses on a national scale on average for all uses (30% in drinking water supply, reaching 47% in irrigation water supply). Although there is no official data readily available on water losses, these figures are not contested by the Ministerial services interviewed in the course of this study, which recognise that the specific problem will need to be addressed as a top policy priority. However, the problem is specific to regional/local suppliers, as infrastructure investments in certain cases have successfully addressed the issue. These concern investments for automated distribution control systems and upgrading distribution networks in the case of several municipal companies. They also concern investments in modern irrigation methods. Minimising water losses is the key issue with respect to water supply infrastructure and will be a priority in future investment and funding plans. (It is noted that the EU average of 18% is set as a target in the EYDAP five-year plan).

The third major issue with respect to infrastructure system efficiency concerns the absence of automation systems in the case of most operators (EYDAP is a notable exception). The implementation of centrally operated automated management and control systems (telematics) for at least the bigger operators will constitute one of the major priorities in the coming years. This will also contribute significantly to the minimisation of water losses and the overall improvement of water supply management. It will be a key priority in the future investment plans of EYATH, the second largest operator.

It is worth noting that two key tools for water resources protection and management are in place under the Ministry of Environment, Physical Planning and Public Works (YPEHODE) - both have been realised through EU structural assistance: (a) the National Database on Hydrological and Meteorological Information; and (b) the National Water Monitoring Network (supervised by YPEHODE) for monitoring surface and ground water quantity and quality issues. To date the network comprises 200 water quality sampling points across Greece in lakes and rivers, and it is foreseen to be extended and upgraded to provide an integrated monitoring system for the management of water resources.



3.1.5 Water Prices – User Charges

Drinking water pricing is explicit and determined at municipal level with small variations in prices between different municipal operators. The water bill also includes sewerage cost expressed as a standard percentage of the water consumption cost.

For drinking water supply (i.e. households and industry/services), municipal operators (including EYDAP and EYATH) apply a progressive volumetric rate for different consumer categories. (Details are provided in Annex D to this report). Charges increase on an annual basis and are announced on the basis of a 5-year programme. There are special pricing policies (ceilings) for large families and for rural isolated areas.

For households, the applied annual increase rate is progressively higher: from 2% in 2002-03 to 12% in 2005-06 for EYATH (similar data for EYDAP), thus effectively the water price rises in real terms (above inflation rate). This is an explicit policy aimed at increasing the level of cost recovery, however it does not as yet fully meet it nor is it likely to meet it in the near future. EYATH, for example, reports that only 60% of its annual revenue comes from billing (a significant share of its investment plans are financed through national and EU funds).

This pricing policy is expected to continue along the same direction, however the degree to which increases in drinking water charges over the next programming period will aim at full cost recovery is a political decision for both central and local governments. At this stage there are no specific plans, methods or specifications as to the mode in which the pricing policy can succeed to achieve full cost recovery by the year 2010, and the Association of Municipal Operators (EDEYA) recognises this as an institutional issue.

Related to the issue of cost recovery is the potential for alternative modes of services and infrastructure provision through the possibilities offered by the recent Public Private Partnership legislation, however there are no concrete plans in this direction at this stage (Source: EDEYA General Congress Report 2005).

No particular issues of household affordability are reported. The charge on water supply and sewerage services is estimated to represent 1.1% of household income (Source: EYDAP). EYDAP indicates an average price for the domestic consumer category of 0.73 Euro per m3 in 2003, with household consumption representing 74% of the company’s revenue. For all drinking water consumer categories, EYDAP reports an average price of 0.67 Euro per m3 for water and sewerage.

Pricing policy towards industry and commerce tends to be beneficial. If the Polluter Pays Principle is to be systematically applied and the households not to bear the heavier cost burden, an increase in billing for these sectors will need to be studied and substantiated against the potential impact on competitiveness and growth of enterprises (notably of SMEs). While there is general awareness of the PPP as a broad stated policy objective for all sectors of the economy, there is no explicit strategy as to its implementation with respect to the water supply sector. Similarly, the legislative requirement for gradually meeting water consumption costs through user charges is acknowledged (the EU legislative deadline requirement for the implementation of a rational water pricing policy is for the year 2010), but there is no implementation strategy at this stage (Source: EDEYA General Congress Report 2005).

Given the pressure on water resources from agricultural use (86% of total supply), even though the sector is not a user of drinking (i.e. treated) water, it is generally recognised that the water pricing policy for this sector will need to be reviewed. There are no specific actions in this direction; a key prerequisite would be a study on the water supply cost for agricultural use. It is noted that the sector benefits from very low water prices (small fee to the Local Land Reclamation Board of the Ministry of Agriculture per “stremma” of cultivated land served by collective irrigation projects, and no fee for irrigation water provided by the Public Power Corporation’s multi-purpose reservoirs).



3.2 Analysis of Future Needs This section attempts an analysis and independent assessment of physical investment needs for the 2007-13 programming period. It follows the methodological guidelines provided to the national evaluator by the central study team and aims to respond to the key questions identified by the central methodological framework of this study. In the absence of quantitative data available on existing (at national scale) or future physical infrastructure needs, unit or total investment costs, the analysis and assessment are primarily informed by qualitative observations.

3.2.1 Review of Policy Objectives and Targets

Planning and implementation is the responsibility of the municipal operators (DEYA) – there exist 215 DEYA in addition to the local operators for the broader urban agglomerations of Athens (EYDAP) and Thessaloniki (EYATH). At central level the Ministry YPEHODE maintains overall regulatory responsibility for water resources management.

The planning structure is to change in line with the requirements of the Water Framework Directive: the administrative framework for the implementation of the WFD is currently being set up further to a Joint Ministerial Decision issued in December 2005, while Regional Water Management Plans are being elaborated as per legislative requirements on a River Basin basis and are expected to be completed in 2008.

At the time of undertaking this study, the consultation procedure for determining needs and priorities for the next programming period was in progress (involving YPEHODE and the Association of DEYA), however no policy or planning documents at national or regional level were (made) available.

The overall key strategic aim as identified in the “National Strategic Development Plan for the Environment and Sustainable Development Sector for the period 2007-2013 (December 2005)” is “to achieve and maintain good conditions in all water systems (surface, groundwater, seawaters) and the sustainable management of water resources”. The key policy objectives in line with this aim and as per the above document are:

1. Ensure drinking water in sufficient quantities and of good quality

2. Stop the deterioration of surface, ground and sea waters

3. Protect and preserve the water ecosystems

4. Ensure the rational use of water

5. Maintain and/or reinstate good quality of bathing waters notably in tourist areas.

The above document does not include any quantified objectives or targets, and no further details are available at programming level (currently in preparation). Further information on future policy needs and priorities relies on extensive interviews with the Ministry YPEHODE competent services and other relevant actors, and has informed the evaluator’s independent assessment of needs and priorities presented below.

As a general comment, it is highlighted that there is no water policy at national level articulated as such and that the “policy priority” at this stage is effectively the implementation of the Water Framework Directive. The WFD has been transposed into national legislation since 2003, however its implementation has been delayed, notably with respect to the administrative structures required to be set up as per legislation, which in turn impact on the development of the necessary planning structures and processes. This delay in WDF implementation is currently being addressed through accelerated processes to be able to benefit from current CSF funds.

In line with WFD requirements, the implementation of the River Basin Water Management Plans currently in preparation and anticipated to be completed in 2008 will need to be the focus of the 2007-2013 programming period. It is therefore of critical importance that the



elaboration of the Water Management Plans be ensured and even accelerated, and that the first “results” of these plans expected at the end of 2006 be available to determine the investment needs and priorities for the next programming period (in the absence of any other or complementary strategic document on water resources at either national or regional level).

3.2.2 Trends in Water Demand

This section aims to assess trends in water demand in view of identifying likely levels of demand in the year 2013.

3.2.2.1 Demographic and Economic Trends and Projections

Estimates on demographic and GDP trends and projections are presented in the Overview Chapter of this report. Implications with respect to the water supply sector:

• The anticipated population increase (estimated at 145,000 over the 2007-2013 period) and corresponding anticipated rate of increase in the number of households is not expected to critically impact on domestic water demand, given also that household pricing policy (volumetric progressive rate and programmed annual increases) act as an incentive for more efficient water consumption.

• Continued growth of the tourism (services) sector will increase pressure on drinking water supply in coastal areas mainly of Southern Greece and in the Islands during the dry (summer) period. Linked to the problem of lack of self-sufficiency for the Islands (notably of the Aegean Island Regions), there is likely increase for water transport and storage facilities that will need to be addressed.

• The agriculture sector, which is by far the higher consumer of water, shows a downward trend in GDP growth and employment (see also unit water demand).

• Growth rates of manufacturing industry sectors using drinking water vary between sectors (e.g. growth in food industry versus decline in textiles), but overall they are not sufficiently high to critically impact on demand (given that together with energy, industry represents less than 2% of total country consumption).

• There are no significant variations between the country’s regions (NUTS II) with respect to the above demographic and economic growth trends, with the exception of the potential impact of tourism growth mentioned above.

3.2.2.2 Unit Water Demand

There are no official indicators nor data analysis on historic trends in water demand at national level or by sector of activity, and there are no official forecasts on water demand. Data is collected by a plethora of services, institutes and operators in their area (geographic or thematic) of competence or interest, however there is no central management of this information nor any form of systematic analysis/processing.

The first (and to date the only) attempt in establishing environmental indicators through collecting and processing relevant data from the various services is a study undertaken by the National Centre for the Environment and Sustainable Development in 2003. (Environmental Signals: A Report on Sustainability Indicators). However, there has not been a follow-up on this report and the proposed indicators have not been updated since.

For water supply (all uses, not exclusive to drinking water), the above study presents a brief analysis of trends relying on data for the years 1990 and 1997. This shows an increase in annual per capita water demand (total updakes, not exclusively for drinking water) from 780 to 830 m3 and estimates (in qualitative terms, no projections) a continued upward trend, as compared to a downward trend of the EU-15 average. This upward historic trend is accounted for mainly by the development of the agricultural sector. The net deviation form



the EU average is comparable to other southern European countries due to the particular climatic and geomorphological conditions.

With respect to water uptakes, the study reports an average uptake rate 12% in relation to the total reserves (lower than most EU countries), and an increasing trend which has significantly slowed down during the 1990s in comparison to the previous decade. Nonetheless, it draws attention to an alarming increase in uptakes from ground water aquifers (40% of total water demand, mostly for agricultural use).

The above study’s brief analysis concludes that there is a need to control increasing water consumption, and that agriculture (being the most important water consumer in the country: 86% of total supply) is a priority sector for promoting policies for the rational use of water resources. However, the same study shows that in 1997, the intensity of water use in agriculture decreased by 20% (to 650 m3 per year per 1000m2 of irrigated area) over the 1990 levels, despite an increase of the irrigated areas by 25%, and in fact came closer to the EU-15 average of 620 m3 per 1000 m2 of irrigated area.

Given the size of investments in sustainable development policy priorities in the agricultural sector since 1997 (effectively through the 3rd CSF), it is reasonable to assume that the downward trend in intensity of water use in agriculture will continue. However, given the climatic and geomorphological conditions and the continued important share of agriculture in the total country water uptake, the study’s initial conclusion as to the priority of the agricultural sector is still valid.

The EYDAP SA operator supplying drinking water to the broader metropolitan area of Athens (in the Attica Region representing 36% of total country population) reports a per capita consumption for all uses for the year 2003 of 0.273 m3 per day (273 lt). This represents approximately 100 m3 drinking water supply per year, which compared to the national average water uptake of 830 m3 confirms the importance of the agricultural sector as a primary consumer. Also compared to the EU average of 150 lt per day, it confirms significantly higher consumption levels. However, any such comparison should consider that tap water supplied to 98% of total number of households is potable water meeting EU quality standards (not compensated for by use of bottled water), climatic conditions and consumption patterns.

More recent historic data available by the EYDAP SA operator (concerns the broader metropolitan area of Athens in the Attica Region, 36% of total country population) presented below confirms the overall upward trend in water demand (refers to total annual supply).

Figure 1 EYDAP SA Data on Annual Water Supply



3.2.2.3 Total Drinking Water Need

As mentioned above, neither forecasts nor historic trends analysis on water demand are officially produced and available. According to the Ministry YPEHODE an analysis of historic data and forecasts will be included in the Regional Water Management Plans. It is strongly recommended that some effort in the direction of systematic data collection, processing and analysis figures as a baseline prerequisite in support of the next period’s programming documents. This is necessary both in view of compliance with the relevant Directive on availability and access to environmental information and because significant investment in the current programming period has gone in the direction of establishing the “base” mechanisms and tools for such systematic information gathering (e.g. the National Centre for the Environment and Sustainable Development, the National Database on Hydrological and Meteorological Information, the National Network on Environmental Information).

It is therefore not possible to address the issue of future water needs other than in the form of qualitative statements on the basis of the information provided in the sections above. A summary of key points as to the factors that will influence water demand and drinking water demand in particular in the future is presented below:

• The demographic trends as presented in the relevant section above are not likely to put critical pressure on drinking water supply infrastructure. Nonetheless, historic data show that a similar demographic trend in the past is linked to a significant increase in drinking water consumption. It is therefore necessary that the policy is re-directed from investment effort to meet increasing demand to an investment effort towards the rational use of water, which is the broadly stated policy objective.

• It is reasonable to expect that economic trends as presented in the relevant section above will increase water demand. This effect is likely to be critical in areas with high growth of the tourism sector which at the same time suffer from dry periods and/or are not self sufficient in water resources – notably the Aegean Islands and southern Greece. This will require investment effort in storage and transfer, nonetheless it is also linked to the need for concrete measures promoting the rational use of water.

• Agriculture remains by far the most important consumer of water uptakes and any efforts towards the sustainable management of water resources will need to consider this a policy priority sector. Support measures in this direction, concerning mainly the expansion of modern and water efficient irrigation methods will need to continue.

Despite regional/local variations, Greece is not overall a high water stressed country (see details on Current Situation section above). It is therefore expected that the anticipated increase in per capita demand to the year 2013 can be met, although collection, storage and transport/distribution issues will continue to figure high in policy objectives. However, policy decisions relate to the overall objective for a sustainable and rational use of water resources and not strictly to meeting increasing demand.

Therefore, if the continued upward trend in the per capita water uptake is to reverse, a water pricing policy that reflects a clear objective for full cost recovery will need to be implemented to act as an incentive for rational and sustainable water use in all economic sectors (including agriculture) and in households. It will of course have to be assessed and substantiated against potential impact on growth and competitiveness of specific sectors. In addition, any such policy will need to be complemented by an explicit policy target for the reduction of water losses and relevant investment programmes, as well as by concrete measures for water savings / rational use of water in line with good practices in other countries.



3.2.3 Investment Needs to Improve Drinking Water Quality

Future priority investment efforts to comply with EU legislation on water quality concern primarily ground and surface waters and are local – that is, they will need to address local variations of overall satisfactory quality standards.

• The key sources of water pollution (locally) are agriculture (nitrate pollution) and urban wastewater – water pollution due to industrial activity is less of an issue and incidents are few and isolated. With respect to wastewater, the issue is being addressed through extensive investment in wastewater treatment (in line with relevant EU legislation, see relevant chapter of this report). Nitrate pollution concerns mainly ground water, the “nitrate sensitive zones” have been listed in relevant legislation (1999) and the relevant measures (concerning agricultural practices) are being implemented. Investment efforts in this direction (i.e. sustainable agricultural practices) will continue to be supported.

• A key problem that is currently being studied is the salination (marine water intrusion) of groundwater sources (mainly coastal aquifers) due to over-extraction. The relevant study is being undertaken by the Institute of Geology and Mineral Exploration (IGME) and involves 6000 study points across the country. The results will provide pointers for future investment in this area, which comprises a policy priority for the next programming period.

• Other issues on water quality concern specific localities notably in the regions of Epirus (higher levels of sulphuric acids in karstic sources), in Thessaloniki and Halkidiki (higher levels of toxic metals concentration), and in the island of Corfu (higher levels of sulphuric acid).

• The National Monitoring Network on Water Quality operates with 200 sampling points in surface freshwaters (lakes and rivers) and 2000 points for bathing waters, while a target of 700 coastal deep-water points is currently being implemented. However, and in view of compliance with EU legislation, the Network needs to be restructured and upgraded to provide a fully integrated water quality monitoring system under the competence of the Regional Water Directorates and the National Water Service. The restructuring plan is anticipated to be completed by the end of 2006, and its further implementation will comprise a key priority. Infrastructure investment is included in the 3rd CSF, while further investment in equipment is likely to figure in the next programming period.

• A particular issue that will require explicit measures is the monitoring system on the water quality of cross-border rivers which is currently inadequate both in physical infrastructure and operational terms. In its specificities, this issue is expected to be addressed through the individual River Basin Management Plans (noted that is further linked to flooding prevention and risk management).

• The laboratories participating in the National Monitoring Network (currently the General Chemical State Laboratory and 3 municipal laboratories Larissa, Chania and Herakleion) are on 10-year contract with YPEHODE for the testing and supply of relevant data in line with legislative requirements. Laboratory infrastructure and equipment as well as certain operational costs were financed through both the 2nd and 3rd CSFs. However, operational costs are very high and will continue to require public investment in the near future.

• Investment in coastal and bathing water quality will continue – having been a priority over the past three programming periods it has produced most significant positive results.

3.2.4 Investment Needs to Improve and/or Replace Obsolete or Non-Compliant Infrastructure

The rational use of water is linked to the problem of water losses in the distribution network. In Greece this appears to be a key problem with respect to both drinking water supply (losses reported at a national average of 40%) and water supply for irrigation (losses reported at an average of 50%). This is well above the EU-25 average of 25-30%. However,



national data on this issue are not systematic, there does not appear to be a comprehensive study available, and although the problem is identified there is no explicit quantified target linked to it. The extent of the problem varies between operators and, therefore, regions/localities. In certain municipal operators’ investment plans it figures as an explicit target (for example, in the EYATH investment plan reduction of water losses to 18%, which is the EU-15 average).

With respect to Drinking Water Supply in particular, investment needs are identified by the individual Municipal Water Supply and Sewerage Companies (DEYA) and are put forward through the Regional Operational Programmes - OPs for the next programming period are currently being drafted and expected to be available in November 2006. In the absence of ROP drafts at the time of the study and of any other relevant policy document, potential issues and investment areas as identified through the assessment of the current situation were discussed with the central government competent services. As a result, the following key objectives and investment priorities are identified:

• Reduction of water losses in the distribution network, mainly through investment in automated distribution systems and technologies. A number of such investments have been successfully undertaken by specific DEYA in the current programming period.

• Address local issues of drinking water (notably raw resources) quality in line with new EU Directive (issues presented in sections above).

• Replacement of decayed distribution networks, an issue impacting on both drinking water quality and losses, and renovation/upgrading of existing drinking water treatment plants.

• Upgrading (infrastructure and equipment) and accreditation of DEYA laboratories for quality measurements of both drinking and surface (raw resources) water as per legislative requirements. A number of such investments have been and/or are successfully undertaken by specific operators (DEYA) in the current programming period.

Given that effectively the entire country population (98%) is served by the drinking water distribution network and connected to metering, the need for local network expansion is not critical and is congruent to demographic and urbanisation trends. Additional capacity with respect to long distance networks is likely to be required in certain regions for the transfer of water in adequate quantities to localities that lack proximity to the regional sources (e.g. in areas of Macedonia and Thrace, which otherwise face no issues with water resources) or that face increased demand during the tourist season (e.g. in areas of the Peloponnese). Investment in additional storage capacity (upgrading of reservoirs and pumps) is also likely to be required in these areas. Transport and storage capacity issues will continue to be central in the case of the islands, notably of the Aegean, and especially during the dry peak-tourist season.

3.2.5 Summary Assessment of Physical Investment Needs

Needs and priorities with respect to water supply are expected to be articulated as part of the Regional Operational Programmes (anticipated to be completed in November 2006), while needs and priorities with respect to water resources quality and management are expected to figure in the Regional Water Management Plans (scheduled to be completed in 2008, first results expected at end 2006).

It is clear that the investment needs to be proposed through the ROPs for the next programming period (in line also with the relevant guidelines issued by the Ministry of Economy and Finance in June 2006) will relate directly to the need to comply with the legislation pertaining to the Water Framework Directive.

• The set up of the administrative framework for the implementation of WFD is currently in progress with respect to the water resources management agencies/services both at central (Central Water Service in YPEHODE) and regional (i.e. Regional Water Directorates) levels further to a Joint Ministerial Decision in December 2005. Investment



will be required to equip these services appropriately as well as for relevant technical studies.

• The country’s river basins have been identified and at this stage they are divided between 14 Water Districts. The current division will be reviewed (possibility to reduce the number of districts will be examined) to finalise the water management administrative framework. Financing of technical studies in this direction will be required.

• Regional (River Basin) Water Management Plans are currently in preparation on the basis of the existing competences (i.e 14 Water Districts) and are due to be completed by 2008. However, by the end of 2006 the first results of the WMPs will enable a first identification and assessment of key needs and priorities at river basin / regional level, and 2007-2013 investment priorities will need to be identified and decided upon on this basis.

The following table summarises the key points discussed in the sections above with respect to physical investment needs.

Table 3.1 Physical Investment Needs in Water Supply

Type of Investment Comments on Needs

Reservoirs (to store surface water)

Need for additional potable water reservoirs to increase storage capacity in certain localities that lack proximity to own resources and face peak demand in dry periods due to tourist activity.

Need for investment in upgrading /renovation of existing plants to improve drinking water quality. Need varies between operators.

Significant need to reverse the trend of over-extraction of groundwater sources (due mainly to agricultural use) and to invest in recharging groundwater resources and improving their quality (key problem concerns marine water intrusion of mainly coastal aquifers, and nitrate pollution in identified risk areas – in the latter case significant investment has been directed in the current programming period).

Drinking water production

Significant need to invest in drinking water production (alternative sources) in certain localities, to address problem of drinking water quality (notably the cases of Thessaloniki – Halkidiki, Corfu, and Epirus).

Need for investment in automated distribution systems and technologies to reduce water losses in the distribution network. Need varies between operators.

Need for extension of long distance drinking water network in certain regions (e.g. Macedonia and Thrace, Peloponnese) to provide water in adequate quantities to localities that lack proximity to own resources and/or face peak demand in dry period due to tourist activity.

Significant need for renovation / upgrading of decaying long distance transport network in view of reducing water losses/leakages.

Significant need not so much for extending (new) but rather for upgrading decaying and obsolete local drinking water distribution network needed (km). Critical to reduce the relatively high water leakages. Need varies between localities and operators.

Transport and connection

Need for additional house connections is follows the general urbanisation and demographic trends – it is not significant given the high percentage of population already connected to the distribution (metered) network



Type of Investment Comments on Needs

Need for investment in appropriately equipping the existing National Monitoring Network on Water Quality (200 sampling points in surface freshwaters) further to its anticipated restructuring, and in order to ensure the feed of relevant data into the National Database on Hydrological and Meteorological Information.

Need for systematic quality monitoring points of groundwater resources.

Need to invest in systematic quality monitoring of cross-border rivers.

Upgrading of infrastructure and equipment and accreditation of DEYA laboratories responsible for quality measurements. Need varies between operators.

Monitoring & Metering

Need for additional house metering needed is not significant given the high percentage of population connected to distribution (metered) network

Technical capacity building of Regional / River Basin Administrative Authorities

Institutional capacity - Water resources management

Scientific and technical studies to inform the elaboration of the River Basin Management Plans

3.2.6 Indicative Financial Investment Requirement

In the absence of data on physical and on financial investment needs at the time of elaborating this report, the indicative investment requirement in water supply for the 2007-2013 period required for the purposes of this study has been estimated on the basis of share in GDP of previous period’s (2000-2006) planned investment in this sector.

Total Cohesion and Structural Funds 2000-2006 planned investment for the collection, storage, treatment and distribution of drinking water amounted to 1,081.6 million euro (this amount excludes the so-called “mixed” water and sewerage projects funded through the Cohesion Fund), which represents 0.096% of the GDP for the year 2004 (taken as an average point). It is noted that investment in the environment sector overall amounts to 1.4% of the GDP (as reported by the Centre for the Environment and Sustainable Development).

If the above percentage (0.096%) is applied to the annual GDP forecasted (see Overview Chapter of this report) for the 2007-2013 period, then an indicative estimate of investment in the water supply sector would amount to 1,304.7 million euro. Correspondingly, this would represent an EU investment contribution, assumed at 75% intervention rate (as per past practice), of 0.978 million euro.

It is stressed that the above is to be used as a rough indicative financial estimate of investment needs for the purposes of this evaluation and is not likely to correspond to the investment needs to be put forward in the programming documents. This figure does not take into account reduced financial investment needs as a result of additional income to be generated through anticipated increases in water charges and potential implementation of Public Private Partnership schemes. On the other hand, it is reasonable to assume that investment in the critical sector of water supply will be maintained overall (not necessarily exclusively public funds) at a standard GDP percentage level.

3.3 Assessment of Field Priorities This section applies the central methodology of this evaluation study to provide:

• An initial ranking of the types of investment in each study field, reflecting the evidence collected and presented in the Needs Analysis; and



• An indicative assessment of the scope to manage and deliver an SF/CF Programme for each study field based on eligibility, the use of flanking measures and issues of administrative capacity.

3.3.1 Initial Ranking of Priorities within the Water Supply Field

The analysis and key arguments upon which the ranking is applied are discussed in section 3.2 of this chapter (Needs Analysis), the prevailing criterion being compliance with the environmental acquis (legislative requirements). Ranking is applied as per the central methodological framework of the evaluation study.

Table 3.2 Ranking Types of Investment Within the Water Supply Field (rank most important as 1)

Ranking Field Type of Investment

Water Supply Transport (including leakage) - long 1

Transport (including leakage) - local 2

Recharging and improving quality of groundwater sources 3

Technical capacity building of river basin administrative authorities 4

Monitoring (including testing) of drinking water resources quality 5

Reservoirs 6

Drinking water production plant 7

Metering No issue

3.3.2 Feasibility of Managing and Delivering SF/CF Programmes to Meet Needs

This section, in line with the methodological framework of this evaluation study, considers the following three (3) issues in terms of assessing the requirements for investment funding from the Structural and Cohesion Funds, and revises the total indicative financial requirement accordingly.

It is emphasised that this assessment is not analytical nor comprehensive, and aims only to provide an indication of potential issues and how they could impact on financial investment requirements.

3.3.2.1 Alternative Funding Sources – Market Schemes

The scope to meet investment needs through market schemes in the near future is judged to be negligible for the water supply sector (see Needs Analysis section).

3.3.2.2 Use of Flanking Measures – User Charges

As discussed in previous sections of this chapter, the existing user charges for drinking water supply and sewerage (waste water treatment) are estimated to represent 1.1% of household income. This revenue is intended to cover maintenance and operating costs, but there is high uncertainty as to the degree to which these user charges cover (if at all) infrastructure investment costs.

In view of the policy towards full cost recovery, it would be reasonable to expect that user charges in drinking water supply, as well as in the waste water treatment and municipal solid waste sectors in Greece, would increase as a share of household income. The



evaluation study indicates that a 5% share of average household income for the three sectors combined is a reasonable indicator. In the case of Greece, on the basis of the trends discussed in the Needs Analysis sections, it is judged not likely that this share will exceed 3% of household income in real terms over the 2007-2013 period for the three sectors combined, given current pricing practices and issues of real cost calculation (discussed in the relevant field-chapter sections of this report).

Over the 2007-13 programming period, this 3% share would indicatively represent an order of magnitude of 16.5 billion2, intended to cover firstly maintenance and operating costs of both existing and new infrastructure, and secondarily infrastructure investment costs. Note that this would apply jointly for all three sectors (water supply, waste water treatment and municipal solid waste).

On the basis of the above, and given the uncertainty issues highlighted, for the purposes of this study we will assume that 20% of the total infrastructure investment requirement to the year 2013 in the water supply sector could (or arguably should) potentially be recovered through user charges. If we assume that drinking water supply charges will represent at least 1% of household income by the year 2013, the above amount is estimated to represent 4.8% of total estimated revenue through these charges – the rest would be covering operating and maintenance costs.

It would be up to the Member State calculation of real costs (including operating and maintenance) and charges revenue to assess whether such an assumption is realistic.

3.3.2.3 Administrative Capacity – Fund Absorption Rate

As discussed in the Overview Chapter of this report, the reported absorption capacity rate for both Cohesion and Structural Fund environmental projects is in the order of 37 to 40%. Issues apply, among others, to the water supply and waste water treatment sectors (combined operating responsibilities), as acknowledged also by the local operators (Association of Municipal Water Supply and Sewerage Companies).

For the purposes of this study, we will assume for the next programming period a marked improvement in absorptive capacity over current period’s performance – estimate 60%. This assumption takes into consideration current efforts in improving the administrative capacity for SF/CF programme management and simplifying and/or streamlining the respective procedures. However, it also takes into account the fact that there is no marked evidence of significant and/or systematic efforts to improve the absorptive capacity of the local operators (DEYA). Hence, the overall assumed absorption rate of 60% still represents a comparatively low level.

3.3.2.4 Revised Financial Investment Requirement

The financial investment estimate resulting from the Needs Analysis (section 3.2) is therefore revised to account for the three (3) key issues addressed above. The following Table 3.3 presents the series of steps taken to revise the initial estimate in line with our assumptions above, and produces the final indicative financial investment requirement for Structural and Cohesion Fund assistance taking into account the potential impact of flanking measures and administrative capacity issues.

Table 3.3: Estimate of Financial Requirement for Water Supply, 2007-2013

Stage in the Field Using Qualitative Judgements To Produce 2 Average annual household income estimate for 2007-2013; 19,000 Euro



Assessment Based on Review Quantitative Estimates

A: Indicative Total Investment Needs (Meuro) – from Needs Analysis

-

1,305 million Euro

B: Investments likely to be covered by market schemes

Approximate share of A:

0%

0

C: Amount recovered from existing user charges not included in investment need

D: Further amount that could be recovered from higher rates for existing or new charges to fund investment

Approximate share of A

20% (indicative assumption)

261 million Euro

E: Financing Requirement Before Absorption Review (A-B-C-D) (Meuro)

-

1,044 million Euro

F: Absorptive Capacity (% of Financing Requirement (E))


G: Financing Requirement After Absorption Review (Meuro)

(E multiplied by F)

626.4 million Euro



4 WASTE WATER TREATMENT

4.1 Current Situation This section provides a brief analysis of the current state of services provision and infrastructure in the wastewater treatment sector. Details on investment through the Structural and Cohesion Funds are included in Annex A to this report. The institutional context and competences are presented in Annex B. Annex C includes a summary of relevant physical indicators.

Issues on data availability are similar to those discussed with respect to the water supply sector (as a result of similar institutional framework and competences with respect to infrastructure and services).


The total census population of all the settlements (Priorities A, B and C) required to have sewerage and waste water treatment facilities for compliance with the Urban Waste Water Treatment Directive (UWWTD) provisions is 7.6 million, of which 6.4 million concerns Priority A and B settlements and 1.2 million concerns Priority C settlements (over a census population of 10.96 million) (Source: YPEHODE, Technical Support Unit, Briefing Note 11/04/2006).

Compliance with the UWWT Directive has not been achieved within the required deadlines, in spite of significant Cohesion and Structural Fund investment during the past and current programming periods in wastewater infrastructure to meet Directive targets.

With respect to Priority A and B settlements, 90% of their total population (i.e. 5.8 million) is connected to the sewerage network and to treatment plants constructed or in the process of being constructed. With respect to Priority C settlements, this percentage is 27% (i.e. 323,000). (Source: as above).

Achieving full compliance with the UWWTD is the most critical and urgent issue around which policy and planning efforts concentrate in the current programming period, and will continue to be a top priority in the next (2007-2013) programming period.

Another critical issue, which does not however figure high in the policy agenda to date (see also 2002 Situation Report on Implementation of 91/271/ published in 2003) is that landfilling remains effectively the only sludge disposal route. This adds to problems faced by the municipal waste management sector (discussed in the following chapter of this report).

A further issue identified by many actors in the field, but not systematically studied, is the problem of illegal connections to the sewerage network by small industrial units that may own but do not systematically operate biological treatment units to avoid operational costs. Similarly, dumping practices are not uncommon mostly in rural areas by small farming units (small livestock farms, illegal slaughter houses, improper washing of pesticide containers). Both of these issues are related to need for efficient and effective surveillance mechanisms.


4.1.2.1 Compliance with Urban Waste Water Treatment Directive

The status of compliance with the UWWTD as in March 2006 is presented below (Source: Ministry of Economy and Finance, Internal Briefing Note on Sewage Treatment Plant and Sewerage Network Situation for Priority A, B and C Agglomerations, March 2006). It is noted that “project” refers to integrated Sewage Treatment Plant (STP) and corresponding sewerage network (SN) infrastructure for a specific agglomeration. PE refers to population equivalent.



• For Priority A agglomerations (i.e. size >15,000 PE, deadline for compliance 31/12/1998): Of a total of 19 projects, 15 are completed and in compliance with the UWWTD and the remaining 4 are currently undergoing the necessary infrastructure investment to achieve compliance (total budget of works in progress 154.53 million euro). Priority A installations are therefore not expected to figure in the 2007-2013 policy and programme objectives.

• For Priority B agglomerations (i.e. size 10,000-15,000 PE, deadline for compliance 31/12/2000): Of a total of 75 projects, 51 are completed and in compliance and 19 are in progress (total budget 191.71 million euro) either with respect to completing the STP infrastructure or with respect to completing the SN infrastructure or with respect to completing both.

Outstanding are five (5) Priority B agglomerations in the Attica region of a total population of 180,500 (approximately 1.6% of total country population) which currently lack both sewerage network infrastructure and sewage treatment facilities (one STP exists in Markopoulo but additional STP capacity is required for the area). The planning for the specific agglomerations is completed, however there have been objections as to its implementation by certain local authorities of the region. As a result the project has been delayed and it has not been possible to commit funds through the current programming period. This will figure as a priority investment in the 2007-2013 programming period.

• For Priority C agglomerations (i.e. size 2,000-10,000 PE, deadline for compliance 31/12/2005) no progress on compliance has been made and planning has only recently been started and anticipated to be completed at end 2006. The corresponding required investment further to the completion of the plan for Priority C will figure as a priority in the 2007-2013 programming period.

Total Priority A capacity (including works in progress) is 6,810,830 PE.

Total Priority B capacity (including works in progress is 4,396.192 PE.

In Greece, tertiary treatment is applied in agglomerations of over 10,000 PE discharging into sensitive areas, while secondary treatment is applied (or to be applied) in all other cases concerning discharge in regular areas (that is, Greece has declined the option of defining “less sensitive” areas, see 2002 Situation Report).

The technical planning / design integrates STP and SN infrastructure requirements in a single project for a given agglomeration. It takes into account the capacity need for storm water treatment and the construction of combined sewer systems are part of each agglomeration’s SN investment plan (EYDAP). Sludge treatment is part of the STP design and investment plan.

4.1.2.2 Sludge Management

The total sludge volume generated (dry weight) was estimated at 80,000 tonnes in 2003, a 35% increase over the 1998 levels (EUROSTAT). A further even higher increase is anticipated given the additional STP capacity of recent years and significant additional capacity currently in construction.

According to the Association of Municipal Water and Sewerage Companies (EDEYA, General Congress Report 2005), the actual sludge quantities are not accurately recorded. Most importantly, of the total volume of sludge generated, only 1.5% is directed to agricultural use, while the exclusive disposal route for the remaining 98.5% is land-filling together with solid waste . This aggravates the problems faced with respect to solid waste management.

The issue of sludge recovery is addressed in the recently updated (2005) Regional Plans for Solid Waste Management. The Regional Plans make a first attempt to record and in some cases to forecast sludge generation. Investment plans for sludge treatment are considered as part of the broader biodegradable/organic waste treatment and recovery schemes that



are proposed in the Regional Plans, however there is lack of concrete proposals based on relevant technical and financial feasibility studies (see chapter on municipal solid waste).

4.1.2.3 Operational Deficiencies of Sewage Treatment Plants

A number of competent actors identify as a key deficiency of the wastewater treatment sector sector the fact that certain “nominally” complying STPs do not operate in full compliance with the UWWTD by not consistently applying the required level of treatment. This is attributed to high operational costs and inadequate maintenance of installations. The only formal document that raises this issue is the Environment Priority Report produced by YPEHODE in December 2005 contributing to the Draft National Strategic Development Plan on the occasion of the Second National Development Conference.

Similarly, the Association of Municipal Water and Sewerage Companies (EDEYA) notes that notably the smaller units - mostly those operated directly by the municipalities as compared to those operated by the Municipal Water and Sewerage Companies (85 in total) - face problems with lack of technically competent personnel for the operation but also for the maintenance of the STP installations (Source: EDEYA, Publication on Waste Water Treatment Management, September 2004).

The problem is identified, however it is not studied or adequately substantiated. It would seem appropriate to recommend such a study in view of identifying the necessary corrective actions that could be undertaken (e.g. personnel training, promoting the technical competences of the DEYA and/or municipality personnel, control mechanisms, or other).

4.1.3 Waste Water Services Pricing - User Charges

Wastewater services pricing is not explicit but a function of the water consumption cost per consumer. Sewerage costs are included in the drinking water consumption bill, expressed as a standard percentage (60% for households) of the total drinking water consumption cost that is billed. Noted that the municipal operators responsible for drinking water supply are also responsible for sewerage and wastewater treatment.

At this stage, although there is an intention for a change in the pricing policy towards full cost recovery for water supply (see relevant chapter of this report), there are no discussions or proposals for any separate billing or for methods of cost calculation for waste water collection and treatment per se. Similarly there are no discussions on prospects to apply the Polluter Pays Principle through, potentially, tariffs linked to pollution load. Issues of household affordability are addressed in the relevant section of the chapter on water supply.

4.2 Analysis of Future Needs This section attempts an analysis and independent assessment of physical investment needs for the 2007-13 programming period. It follows the methodological guidelines provided to the national evaluator by the central study team and aims to respond to the key questions identified by the central methodological framework of this study.


The exclusive focus of policy with respect to wastewater treatment in Greece is the implementation of the Urban Waste Water Treatment Directive (91/271/EC, UWWTD), concerning the collection, treatment and discharge of urban waste water from identified settlements/agglomerations. There have been significant delays in its implementation (i.e. the Directive deadlines with respect to the 3 categories of agglomerations were not met), and a big investment effort in current programming period to achieve compliance. With respect to the industries affected by the Directive (52 industrial units, 3.4 million population equivalent) compliance is reported to have been achieved. (Source: 2002 Situation Report).



For the 2007-2013 programming period, the stated objective is to achieve full compliance with UWWTD through investment to plan and realise the outstanding projects for the respective agglomerations. Details are presented in the section below.

4.2.2 Physical Investment Needs

The physical investment needs for the next programming period will concern Priority B and C agglomerations, as follows:

4.2.2.1 For Priority B Agglomerations Investment will be required for both sewerage networks (SN) and sewage treatment plant (STP) infrastructure to serve five Priority B agglomerations in the Attica Region of a total population of 180,500 (approximately 1.6% of total country population and 2.4% of the total agglomerations’ population falling under UWWT Directive prerequisites). Four of these - Nea Makri, Koropi, Artemida and Rafina - lack both sewerage network infrastructure and sewage treatment facilities. The Markopoulo municipality lacks sewerage network (only a small part 20% has been constructed) but disposes of an STP installation.

4.2.2.2 For Priority C and Other Agglomerations

The responsible Ministerial service (Water Unit of YPEHODE) emphasises that the accurate mapping and analysis of the current situation in Priority C agglomerations has only recently been initiated and that a detailed needs analysis will only be available further to this exercise at end 2006. Further to this analysis currently being undertaken by the Ministry, the detailed planning will be implemented to determine the number and PE capacity of required STPs and corresponding SN infrastructure to be included in 2007-2013 programming documents.

It is noted that as per the 2002 Situation Report on Implementation of 91/271/EC, Priority C concerned a total of 327 agglomerations with 1,422.7 PE. (At the time of writing this report, the 2005 Situation Report on Implementation of 91/271/EC which Greece is required to produce every two years was not yet available).

The information provided below provides a preliminary description of the situation to be addressed in view of full compliance with UWWTD with respect to the Priority C and other agglomerations. It relies on data included two sources: (a) YPEHODE Working Group on Waste Water Treatment Projects, Final Report July 2005, and (b) Ministry of Economy and Finance Briefing Note on Sewage Treatment Plant and Sewerage Network Situation, March 2006.

Priority C and other agglomerations concern a preliminary listing of total of 327 settlements of a population between 2,000 and 10,000 as per UWWTD requirement or, in some cases, less than 2,000 (14 of the listed settlements have a population of less that 1,700) where an STP and/or SN infrastructure (not necessarily complying) have been constructed. This category of agglomerations according to the above listing concern of a total population of 1.2 million (approximately 11% of total country population and 16% of the total agglomerations’ population falling under UWWT Directive prerequisites).

The state of the wastewater infrastructure varies between settlements. For example, according to the above listing, a total of 27 settlements (total population 82,400) have SN completed to a capacity between 90% and 100% of actual population which, however, is not served by an STP. A total of 138 settlements with a total population of approximately 560,500 (about 5% of total country population and 7.4% of the total agglomerations’ population falling under UWWT Directive prerequisites) are not served by SN or STP infrastructure at all.

Overall, in these areas a total of 196 STPs exist: 110 STPs are indicated to be in operation but do not all necessarily serve the entire population of the agglomeration due to lack of SN infrastructure and appropriate planning; 45 are constructed but not in operation mainly due



to lack of SN infrastructure; and 41 are currently under construction. Also, the existing STP capacity is not available in PE, and any planning of individual STPs has not necessarily been undertaken in line with the specifications on capacity (see section 4.2.3.1 below).

The needs analysis and planning currently being undertaken by the competent governmental and local authority services will aim to rationalise the number of required STPs with expansions and/or upgrades of existing ones (and the determining the corresponding SN requirements) in order to comply, and with “regroupings” of settlements to be served by a single STP.

4.2.3 Trends in Demand

This section aims to review trends in demand for wastewater treatment by the year 2013 as a check on the capacity needed. It is noted that unit investment and operating costs are not available. The competent services report significant variations between regions/localities.

4.2.3.1 Demographic and Economic Trends

The regulatory specifications for technical studies/designs require that STP capacity is planned for a 20 year duration period, while the SN capacity for a 40 year duration period, taking into account demographic and economic trends. (For an analysis of these trends see chapter on water supply, impacts are similar).

For the period to 2013, there may be a number of currently listed Priority C settlements that might actually exceed the 10,000 PE limit, not as a result of demographic trends but as a result of changes in the areas of jurisdiction of certain municipal administrations. This will impact on planning only to the extent that such settlements discharge into sensitive areas (i.e. requirement for tertiary treatment). The situation will be recorded in the mapping exercise currently undertaken by YPEHODE to be completed by end 2006.

4.2.3.2 Unit demand for waste water treatment

Planning is based on a unit demand volume of 150 l/PE/day raised to 200 l/PE/day for tourist areas. The actual organic biodegradable load is estimated at 50-55 g BOD/PE/d, while the actual capacity of installations is reported to be higher than that (Ministry of Economy and YPEHODE, Technical Support Unit).

Forecasts on unit demand for waste water treatment are not available.


There are no financial estimates available for either the outstanding Priority B projects or for the Priority C. The competent services of YPEHODE are currently undertaking the relevant study, and advise against the use of any average or assumed unit investment cost figures to determine the required investment as bad practice in the absence of any accurate data on physical needs.

Given the requirement for an indicative investment estimate for the purposes of this study, the evaluator provides the following hypothesis:

For outstanding Priority B (North-East Attica), requiring additional STP capacity and SN connection of 180,500 inhabitants (note that PE is not available), an estimated figure that had in the past resulted from a preliminary feasibility study amounted to roughly 200 million euro. This figure is comparable to the 128.5 million euro planned by EYDAP S.A. for the construction of an STP and new SN infrastructure in Elefsina (North-West Attica) for a population of 117,000 (287,000 PE).

If for Priority C we assume an indicative 300 million euro, then the total investment requirement assumption of 500 million would represent between 0.3 and 0.4% of the forecast GDP values for the years 2007-2013. This would compare reasonably to the 0.1% of annual GDP (year 2004 taken as the average point) that corresponds to the total planned



2000-2006 investment for wastewater treatment infrastructure. Given the marked progress towards UWWTD compliance in terms of physical infrastructure, actual and anticipated through committed funds (servicing 87.5% of total country population), it is reasonable to expect that investment requirement expressed as a GDP percentage will significantly drop in the next programming period. According to this scenario it would effectively be little more than halved.

For the investment on wastewater treatment infrastructure for the Priority B and C identified above, Greece will seek EU assistance through Cohesion and Structural Funds of the 2007-2013. For the purposes of this report this assistance is assumed at 75% (as per past practice) of total (public) investment. On the basis of the above hypotheses, it would represent 250 million.Euro.

Table 4.1 Estimate on Indicative Investment Requirement in Waste Water Treatment

Type of investment Indicative Investment Cost Assumptions

(M Euro) Priority B Agglomerations One new STP including SN

infrastructure for 5 agglomerations of 180,500 population

200

Priority C Agglomerations (concerns a total population of 1.2 million)

Construction of new STPs (number not identified), and corresponding SN infrastructure

Expansion and/or upgrading of existing STPs (potential maximum number 150)

Renovation and/or upgrading of existing SN infrastructure (number not identified), including combined sewer overflow and pumping stations

New SN infrastructure (number not identified), including combined sewer overflow and pumping stations

300

Total Investment Hypothesis 500




4.3.1 Initial Ranking of Priorities within the Waste Water Treatment Field


Table 4.2 Ranking Types of Investment Within the Waste Water Treatment Field (rank most important as 1)




New STPs for Priority B settlements 1 Waste Water Treatment New sewerage network for Priority B settlements 1*

Additional STP capacity for Priority C settlements** 2

Additional sewerage capacity for Priority C agglomerations** 2*

Sludge treatment 3

Sludge disposal 4

* Physical planning for STP and sewerage networks is integrated into a single project, hence the same ranking is applied

** Additional capacity for Priority C includes the renovation/ upgrade of existing sewerage and of STPs





The scope to meet investment needs through market schemes in the near future is judged to be negligible for the waste water treatment sector (see Needs Analysis section).


The potential impact of user charges estimated as a share of average household income are discussed in the respective section of the chapter on water supply, and applies equally to the waste water treatment sector. We therefore apply the same argumentation to assume, for the purposes of this study, that 20% of the total investment requirement to the year 2013 in the waste water treatment sector could (or arguably should) potentially be recovered through user charges.

If we assume that waste water treatment charges will represent at least 1% of household income by the year 2013 (that is, a total of 2% combined with the water supply sector, up from the current estimated 1.1% share), the above amount is estimated to represent 1.8% of total estimated revenue through these charges – the rest would be covering operating and maintenance costs.



As discussed in the Overview Chapter of this report, the reported absorption capacity rate for both Cohesion and Structural Fund environmental projects is in the order of 37 to 40%. Issues apply, among others, to the water supply and waste water treatment sectors (combined operating responsibilities), as acknowledged also by the local operators (Association of Municipal Water Supply and Sewerage Companies).



For the purposes of this study, we will assume for the next programming period a marked improvement in absorptive capacity over current period’s performance – estimate 60%. This assumption takes into consideration current efforts in improving the administrative capacity for SF/CF programme management and simplifying and/or streamlining the respective procedures. However, it also takes into account the fact that there is no marked evidence of significant and/or systematic efforts to improve the absorptive capacity of the local operations (DEYA). Hence, the overall assumed absorption rate of 60% still represents a comparatively low level.


The financial investment estimate resulting from the Needs Analysis of section 4.2 above is therefore revised to account for the three (3) key issues addressed above. The following Table 4.3 presents the series of steps taken to revise the initial estimate, and produces the final indicative financial investment requirement for Structural and Cohesion Fund assistance taking into account the potential impact of flanking measures and administrative capacity issues.

Table 4.3 Estimate of Financial Requirement for Waste Water Treatment, 2007-2013

Stage in the Field Assessment Using Qualitative Judgements Based on Review

To Produce Quantitative Estimates


- 500 million Euro



0%

0





100 million Euro


-

375 million Euro

F: Absorptive Capacity (% of Financing Requirement (E)) 60% (indicative assumption) -


(E multiplied by F)

225 million Euro

5 MUNICIPAL SOLID WASTE MANAGEMENT

5.1 Current Situation This section provides a brief analysis of the current state of provision and physical infrastructure with respect to municipal solid waste management. Details on investment



through the Structural and Cohesion Funds are included in Annex A to this report. The institutional context and competences are presented in Annex B. Annex C includes a summary of relevant physical indicators.


As at 2001, organised collection and transportation of municipal waste in Greece was applied for 85% per weight of the generated waste, while the rest 15% corresponded to low-populated rural and mountainous areas (Source: UN CSD 12). Updated YPEHODE data (internal note) raise this figure to 90% for the year 2005.

The Joint Ministerial Decision 29407/3508 of 2002, updating previous legislation, sets measures and conditions for the sanitary disposal of solid waste in line with the EU Landfill Directive (hereafter, the term landfill is used to indicate sanitary disposal in compliance with EU and national legislation). A series of other legislations set the recycling requirements for specific types of solid waste, including packaging materials, batteries, waste oils, PCBs, car tyres, construction waste, electrical and electronic equipment, medical waste and transport vehicles.

Objectives and quantitative targets for solid waste management, including municipal solid waste, in line with EU legislation, are set at national level by the five-year National Plan for Solid Waste Management issued in 2003 (Joint Ministerial Decision 50910/2727 of 2003). The National Plan requires the elaboration of Regional Plans (for each of the thirteen regions) fully harmonised with its content. Regional Plans identify the “share” of each region to the national quantitative targets and propose the required physical infrastructure and investment needs to meet these targets. The 2005 updates of the Regional Plans for Solid Waste Management were in the process of being submitted to the Ministry YPEHODE at the time of undertaking this study.

Nonetheless, in spite of the full transposition of EU legislation into national legislation and the existence of the appropriate planning mechanisms, there are still to date significant delays in the implementation of legislative requirements with respect to the completion of the necessary complying infrastructure.

The number of con-compliant waste disposal sites remains high. The European Court of Justice recently (6 October 2005, C502/03) convicted Greece for failure to comply with respect to 1,125 illegal disposal sites. Furthermore, several of the existing landfill facilities have long exceeded capacity – e.g. the Ano Liossia facility in the broader Athens agglomeration and the Tagarades facility in Thessaloniki. Problems are aggravated by the fact that the recycling effort is still comparatively low (8.8% of total municipal waste) and there is effectively no treatment of municipal waste at this stage through any appropriate technologies (e.g. incineration or composting, for details on existing composting plants see section below). Over 90% of total municipal waste produced is currently directed to disposal sites.

In several cases, the slow progress in implementation has been due to strong local public opposition to proposed landfill locations. For example, in the Attica Region, by far the highest producer of waste in the country, public opposition which escalated to legal action blocked for a long period the construction of the three new landfills planned for the region.

Municipal solid waste management is to date one of the most critical environmental issues of the country, and furthermore the most “visible” problem affecting citizens’ everyday quality of life. The problem comprises a top policy priority for the competent Ministry YPEHODE, with significant amounts of Cohesion and Structural Funds being currently invested in the construction of new landfills and intermediate transfer stations, and in the closure and reclamation of illegal disposal sites, and with marked progress made in this direction.



5.1.2 State of Infrastructure3

Municipal solid waste (MSW) generation was 4.6 mt in 2001 (National Plan for Solid Waste Management; 4.7 mt if aggregated on the basis of Regional Plan data) and estimated at 5 mt in 2006 of which 4.5 mt (data YPEHODE) is household waste. It is estimated to reach 5.6 mt in the year 2013 (see section on forecasts below).

In 2005 (data YPEHODE), 45% of packaging material (PM) generated as waste was recycled – 479,000 t of 1.05 mt produced. This is close to the standing national target of 50% PM recycled or otherwise treated. For the year 2006 an additional 60,000 t (5.7% of total PM generated) are expected to be treated and supplied as incineration material for energy production to the cement industry, through the operation of the Mechanical Recycling and Composting Unit (EMAK) in Ano Liossia Attica. Thus the PM target is expected to be fully met as of 2006. The same target for the year 2011 is estimated to represent 676,000 t PM to be recycled or otherwise treated. This represents a significant increase of 41%, certain to require additional investment in PM recovery/recycling infrastructure. It is nonetheless noted that PM represents a relatively low share (21%) in MSW generated in Greece (see relevant section on composition of MSW below).

Overall, separate collection and recovery/recycling in 2005 covered only 10.4% of household waste or 8.8% of total MSW. It comprised 8.2% fermentable/biodegradable material, 29.2% paper, 33% glass, 24% metals and 5% plastic. Other than the recycling and/or treatment of packaging material, only an additional 27.009 t (0.05% of total MSW generated) in 2005 was treated in the mechanical recycling and composting plants operating in Ano Liossia (Attica - EMAK) and in Hania (Crete). Other than the above, the remaining 90.5% of MSW produced in Greece is land-filled, either in sanitary landfills or in non-complying (illegal) disposal sites.

With respect to composting, it is noted that both composting units mentioned above operate under capacity in a pilot phase, while a third unit established in Kalamata (Peloponnese) has ceased operation and is currently undergoing infrastructure upgrading investment. This is the reason why MSW recovery/composting data dropped from 32,000 t/y for 1997-2002 to 0 in the year 2003 (EUROSTAT). The target for Kalamata is to reach its full, increased capacity of 75,000 t/year by 2013, while the capacity for the Hania mechanical recycling and composting unit is for 70,000 t/y and the planned capacity for EMAK in Attica is 385,000 t/y.

On the issue of recycling, although activity is still comparatively low, significant growth is noted as this is an area increasingly attracting private sector interest with increasing investment in packaging materials, batteries, recycling of oils, transport vehicles and car tyres. The Recycling Sector Production Index has been consistently higher than the General Production Index throughout the period 2001-2004; in fact it has been the highest index in comparison to all other economic activity sector indexes in 2001 and in 2004, and the second highest in 2002 and 2003.

Year Production Index Recycling Sector Production Index General

2001 98.8 98.2

2002 123.5 99.0

2003 134.1 99.3

2004 128.8 100.5

3 Data for this section is a compilation of data of various years identified in different sources for the different items. All sources are listed in the relevant section of the Reference Chapter of this report.



Source: National Statistical Service

Lastly, it is noted that the particular geomorphology of the country, notably the large number of small islands, poses particular challenges for solid waste management (as in fact it does for other types of utility and other infrastructures): the number of relatively small sanitary landfills to comply with legislation is high, increasing both investment needs and subsequent operational costs. The issue is more prominent in the case of the Southern Aegean Region (plethora of small islands, high tourist and related seasonal economic activity, climatic conditions inhibiting regular transport by sea, other issues with respect to the sea transport of waste).

5.1.3 Policy on Waste Charges

Municipal solid waste charges are included in the municipal tax, which is billed per residence/premise as a function of the premises’ surface. The charge is not linked to the quantity or type of waste generated/disposed and does not take into account nor does it act as an incentive for any recycling effort. In addition, there is no clear and systematic information available as to the actual operating costs of the totality of MSW management services per region (the one exception is the Region of Western Macedonia which since July 2005 operates the first Regional Integrated Solid Waste Management System).

The existing charge per se is actually far too low to address the critical infrastructure investment needs and the operating costs of waste collection and disposal. New legislation to be developed in 2007 will require the local/regional operators (FOSDA) to devise and apply a pricing policy that will gradually aim at full cost recovery. An additional requirement is the development of methods for the full costing of municipal waste management services. This is a precondition in order to both increase cost recovery and cost transparency.

On the other hand, the increase in waste charges is likely to be a critical factor in reducing the rate of waste generation, provided that the Producer Pays Principle be applied through the pricing policy – that is, in addition to being transparently calculated and explicitly billed, there is need to formulate some type of policy whereby charges are linked to the actual quantities generated per type of waste and/or producer. Such a policy will need to consider appropriate tariff systems for certain types of waste, and include incentives or penalties directly aiming to increase recycling and other source separation efforts.

5.2 Analysis of Future Needs This section provides an analysis and independent assessment of physical investment needs for the 2007-13 programming period. It follows the methodological guidelines provided to the national evaluator by the central study team and aims to respond to the key questions identified by the central methodological framework of this study.


The key policy documents on municipal solid waste management in Greece at this stage are: (a) the National Plan for Solid Waste Management issued in 2003; (b) the 13 Regional Plans for Solid Waste Management which were first issued in 2001 and updated in 2005 – they are in process of being formally submitted to the Ministry YPHEDOE for opinion in the course of the first semester 2006.

The National and Regional Plans fully integrate specific targets for municipal solid waste management for the years 2010,2013 and 2020 that are set in line with EU and national legislation. The targets concern: (a) specific reduction rates for the quantities of biodegradable waste that is land-filled, therefore specific targets for quantities of biodegradable waste that needs to undergo treatment; (b) specific rates for the quantities of



packaging and other specific material to be recycled, re-used or otherwise treated (refers to 2939/2001 legislation on alternative management of packaging and other material).

The review of policy objectives and targets in this section of the report is further informed by discussions with and additional documentation (internal notes and reports) provided by the competent services of the Ministry YPEHODE and by the Managing Authority of the Environment Operational Programme (EPPER).

The overall strategic direction is for the development of integrated systems for waste management at regional level to achieve a reduction in disposed volumes of waste and a concomitant increase in recovered material through recycling and treatment. The key policy objectives and targets on municipal solid waste are outlined below (listing order does not refer to order of priority):

• Closure of all the currently active illegal disposal sites (hereafter, non-complying illegal waste disposal sites will be referred to by their Greek initials HADA) by end 2008 and their complete remediation.

• Completion of the programme for the construction of new, expansion and upgrading of existing sanitary landfills in line with the Regional Plans. Issuing of permits for all sanitary landfills in operation (in line with legislation) by end 2009.

• Development of waste transfer station networks at regional level (as per Regional Plans) as part of integrated disposal systems for each sanitary landfill or recovery facility.

• Recovery of 50% of packaging material through recycling (25%) and other treatment.

• Reduction of biodegradable waste land-filled to 75% of 1995 levels for the year 2010, to 50% for the year 2013, and to 35% for the year 2020. This reduction is to be achieved mainly through separation at source combined with treatment facilities using the most suitable for the specific context (waste volumes and composition) recovery technologies (biological treatment) such as aerobic composting and anaerobic digestion for energy production.

• Development of a billing policy by the operating agencies at local and regional level (FOSDA – Solid Waste Management Agencies) that aims at full cost recovery. A pre-condition is the elaboration of relevant legislation (anticipated to start in 2007) on the legal form, organisational aspects and mode of operation of the FOSDAs; the specific legislation will also establish the billing policy to be implemented by the FOSDA as a legal requirement and will provide specifications for its implementation.

• Organisation of the FOSDA at local / regional level as per requirements of anticipated legislation discussed above. Possible restructuring of Solid Waste Management Units (i.e. geographic areas of responsibility) to simplify and mainstream administrative responsibilities with respect to MSW management, which is currently divided between different agencies/actors for different fragments of the operation (i.e. collection services, operation of transport stations, operation of landfill sites).

It is clear that, as with other environmental sectors, policy objectives on municipal solid waste are exclusively EU legislation driven. In addition to physical investment needs notably with respect to disposal and recovery, there are also critical issues with respect to waste charges and institutional capacity (organisation and mode of operation of FOSDA) to be addressed.

It is evident that the target set by the National Plan (in line with EU legislation) that will drive the infrastructure investment priorities in the future is that relating to the reduction of biodegradable/organic material land-filled to 50% of 1995 levels by the year 2013 (and 35% by the year 2020). This means treatment of 1.1 mt of biodegradable municipal waste by the year 2010 (36% of total estimated production), of 1.9 mt by the year 2013 (60% of total estimated production), and of 2.7 mt by the year 2020 (75% of total forecast production).



This will require additional investment in recovery/treatment infrastructure, complementing current investment effort in the elimination (closure and remediation) of illegal disposal sites and construction of new sanitary landfills. This target is indeed the underlying principle driving the investment proposals formulated in each of the Regional Plans on Solid Waste Management which are discussed in detail in the following sections of this chapter.

It is noted that hazardous waste management, although not within the scope of this study, comprises a top policy priority for waste management for the next programming period. The relevant legislation on National Planning for Hazardous Waste Management is to be issued in the coming months (before end 2006), and there are delays with respect to initial plan (deadline for National Plan was end 2005).

5.2.2 Review of Future Trends

5.2.2.1 Demographic and Economic Trends

The quantity of municipal solid waste in Greece reached 4.6 million tonnes in 2001 having increased by 47% compared to the 1990 levels. This is twice the rate of increase of the GDP over the same period, and is attributable to the improvement of living standards and changing consumption patterns. (Source: NCESD, Environmental Signals).

The demographic upward trend and the anticipated GDP growth rate over the next programming period as presented in the Overview Chapter of this report, are expected to raise the levels of waste generation – although a number of studies agree that the increase in waste generation will be at rates lower than during the past decade (see forecasts in section below) when there was a marked change in consumption patterns.

Demographic and economic trends are fully accounted for in explicit quantitative terms in the waste generation forecasts for the period to 2020 that are included in the Regional Plans. This is a prerequisite to determine investment needs. The physical investment proposals discussed therefore in the following sections of this chapter take fully and explicitly into account forecasts on population growth and increased economic activity, including the impact on the population of increased seasonal tourist activity.

5.2.2.2 Trends on Waste Charges Currently there is no indication as to the pricing policy to be developed in view of full cost recovery other than it is likely that this will be developed by each regional or local Managing Agency (FOSDA). Overall costs are also expected to increase given the planned establishment of new facilities for the collection and treatment of biodegradable/organic waste (focus of investment effort in next programming period, see sections below).

The financial impact on each household or enterprise/industry will therefore vary significantly between regions or localities within regions, as a function of significant variations in infrastructure investment and operating costs. This is further linked to planning decisions given the various options/scenarios, as several smaller (in terms of capacity) recovery or disposal units across a region, notably the case of islands or other relatively isolated regions, have significantly higher operational costs in comparison to larger units. Where such regions are also relatively low-populated, the cost per inhabitant factor increases further.

Provided below are the indicative costs per inhabitant for selected regions as per the respective Regional Plans and their supporting technical studies:

In the case of Western Macedonia the identified operating cost per tonne of MSW as it currently stands (for the entire region, single integrated solid waste management system includes one sanitary landfill and a network of six waste transfer stations) is €27.5 per tonne. Further to the completion of the system through source selection operations and the establishment of a biodegradable waste treatment plant, the indicative estimated cost rises to €62 per tonne, or €25 per inhabitant per year, not including capital investment costs. This



amount would represent for a four-member family not more than 0.5% of (national) average household income.

In the case of the Northern Aegean, where a total of seven sanitary landfills (SL) are planned to operate, operating costs vary significantly in each case: they range from €5.23 per tonne and €2.7 per inhabitant per year in the case of the SL on the island of Lesvos, to €214 per tonne and €83.05 per inhabitant per year in the case of the small island of Fournoi. Note that in this case the operating costs of planned/proposed recovery facilities (composting) are not included. The technical study interestingly notes that if a transfer station instead of an SL is opted for in the case of Fournoi, the operating cost would drop to €57.5 per inhabitant, including the cost of transfer to the SL of the nearest neighbouring island. Nonetheless, these amounts would represent for a four-member family between 1.2% and 1.8% of (national) average household income.

5.2.2.3 Unit Municipal Waste Generation

Despite the significant increase in waste generation over the past decade, the per capita annual MSW generation in Greece in the late 1990s was 27% lower than the EU-15 average (Source: NCESD, Environmental Signals). The average per capita MSW generation over the decade 2001-2020 is defined in the National Plan issued in 2003 at 1.14 kg per day or 416 kg per year, which is by 10% lower that the EU-25 average (460 kg/per capita/per year). The 1.14 kg average defined in the National Plan is used by many Regional Plans to provide own MSW estimates, projections and forecasts. There is, however, an issue as to the validity of this figure over the twenty-year period given the continued increase in MSW generation – in 2003 MW generated already amounted to 428 kg per person annually (EUROSTAT).

In the urban agglomerations of the Attica Region, the per capita MSW generation is 1.29 kg per day (Source: Attica Regional Plan on MSW Management), that is 13% higher than the national average. Unit municipal waste generation is lower in rural areas, however the evolution of waste generation between regions does not differ significantly.

5.2.2.4 Total Municipal Waste Generation

Planning for the management of MSW is based on forecasts of total municipal waste generation to the year 2020 at national and regional levels, on the basis of which the legislative percentage targets (e.g. for treatment of bio waste) are quantified also for the interim years 2010 and 2013.

Annual forecasts to the year 2020 are provided in two main sources:

(a) The Plan for the Management of Biodegradable Waste, an independent study carried out on behalf of the Ministry YPEHODE in 2003, which calculates at national level the quantities of biodegradable waste at target years according to the National Plan and relevant legislation.

(b) Each of the 13 Regional Plans for MSW Management for the region in question (NUTS II and NUTS III levels), backed by formally submitted technical studies developed in line with detailed specifications issued by the Ministry YPEHODE.

The study (a) above forecasts a 35% increase in total municipal waste generation over the period 2001-2020, and an average annual rate of increase of 1.5% over the same period. This is assessed and broadly accepted as a reasonable and likely scenario by all technical studies supporting the respective Regional Plans. The studies further use this scenario co-weighted with and adjusted by other local factors concerning population and economic growth historic data and forecasts (including tourist growth for the NUTS II or III areas where this is relevant), to produce regional forecasts and quantified targets for MSW management (notably recovery and disposal). The evolution of municipal waste generation presented in the Regional MSW Management Plans is depicted in Table 4A below for the years 2001, 2006 and 2013 - it shows a consistent increase in generation levels across all regions.



Table 5.1: Total Municipal Solid Waste Generation (in million tonnes)

Source: Regional Plans 2001 2006 2013

National – Total Regions 4.706* 5.085* 5.625*

Attica 1.775 1.912 2.122

Continental Greece 0.255 0.275 0.305

Western Greece 0.299 0.322 0.357

Central Macedonia 0.839 0.903 1.003

Western Macedonia (0.110) 0.119 0.132

East Macedonia & Thrace 0.221 (0.228) 0.237

Thessaly 0.314 0.336 0.386

Epirus 0.120 (0.128) 0.139

Peloponnese 0.255 (0.275) 0.305

Ionian Islands 0.079 0.085 0.095

Crete 0.229 0.280 0.304

Northern Aegean (0.088) 0.099 0.115

Southern Aegean* [0.122] [0.123] [0.125]

Source: Regional Plans for Solid Waste Management

*The Southern Aegean Regional Plan for Solid Waste Management was not available as at May 2006. Estimates have been provided on the basis of population projections and the national average municipal solid waste generation figure of 1.14 kg per person per day.

** Figures in brackets have been calculated on the basis of the annual rates applied by the respective Regional Plan, with the exception of the Southern Aegean, see note above.

5.2.2.5 Composition of Municipal Solid Waste

According to the National Plan (issued in 2003) the average qualitative composition of MSW produced in Greece is: 47% fermentable material, 20% paper, 8.5% plastic, 4.5% glass, 4.5% metals, 15.5% other material. The share of packaging material is estimated at 20%. According to the Environmental Signals Report (National Centre for the Environment and Sustainable Development, 2003), the above indicator on waste composition was calculated in 1997, based on data covering 30% of the country’s population in urban, rural and tourist areas and on estimates for the rest of the population. According to the Regional Plans (developed in 2005), there has since been no systematic attempt to study and monitor the qualitative composition of MSW produced in any of the regions, with the exception of the Region of Western Macedonia which since July 2005 operates the first complete Integrated Waste Management System at Regional level in Greece.

On the basis of the above data and Regional Plan estimates on MSW composition, MSW in Greece is characterised by a relatively high content of fermentable materials (and therefore an elevated content of humidity – also their decomposition in landfills is connected to the production of methane “greenhouse gas”) and a relatively low share of packaging material. The high percentage of fermentable materials renders as a rule non suitable / non viable the adoption of incineration and mechanical separation techniques.

Accurate and updated data on the qualitative composition of municipal solid waste, as well as in particular on the composition of biodegradable waste generated, are absolutely critical in order to inform infrastructure investment decisions on waste treatment and recovery per region. It is recommended that such study(ies) be undertaken as a priority to



inform the strategy on MSW infrastructure investment priorities per Region (in line with Regional Plan proposals) for the 2007-13 programming period.

5.2.3 Physical Investment Needs and Indicative Financial Estimates

The aim of this section is to provide an overview of the total physical investment needs for municipal waste management in Greece over the 2007-2013 programming period, and an indication of respective financial investment requirements.

Information on needs is available in detail per Region (NUTS II) in each of the respective Regional Plans for Solid Waste Management as updated in 2005. The current (as in May 2006) status of the Regional Plans was as follows:

• Formal decision issued on nine (9) RPs: Attica, Continental Greece, Western Greece, Central Macedonia, Thessaly, Epirus, Peloponnese, North Aegean, Crete;

• Three (3) RPs in opinion process: Western Macedonia, Eastern Macedonia and Thrace, Ionian Islands;

• One (1) RP, South Aegean, not formally submitted yet (expected June 2006).

The Regional Plans include for the most part estimates of financial investment needs corresponding to the identified physical needs. Physical needs, as indicated above, take account of demographic and economic trends as well as municipal solid waste forecasts and treatment targets. Financial investment needs where not referring to actual public funds committed are only indicative, and the method of their calculation is presented and substantiated in each RP. These estimates are subject to technical feasibility studies prior to public fund commitments.

In the few cases where financial cost estimates for identified physical infrastructure needs have not been provided in the respective RP, the evaluator has applied average unit costs sited in the RPs and target assumptions in view of providing an indicative financial investment requirement for the next programming period as per the requirement of this study.

The situation and needs analysis in the RPs and accompanying technical studies is at the level of “Management Unit Area” – within most regions there are several Management Units, each covering a specific geographic area. Given that the requirement of this study is to present total needs at national level per type of investment, the figures included in the RPs have been aggregated for the required categories first at regional and then at total-national level by the evaluator (excluding the Region of the South Aegean for which an RP was not available at the time of elaboration of this study). Qualifying statements or comments/highlights for specific regions are included as appropriate.

It is furthermore noted that RPs present the totality of investment needs as at baseline year 2005; part of this investment is already covered by current programme funds. Where indicated in the RPs, only future needs – that is needs for which funds have not yet been approved and/or committed – are presented in this section, as these are to require funding over the 2007-2013 programming period.

5.2.3.1 Waste Collection

RPs do not provide details on investment needs with respect to waste collection services, as these services are the direct responsibility of each Municipality (i.e. not perceived as part of regional planning, it does not fall within the jurisdiction of the FOSDA). However, certain RP technical studies mention strongly the need for organised proper sanitary cleaning facilities of municipal waste bins, containers and vehicles, and some mention the need for the upgrading / renewal of equipment (bins, containers, vehicles, installation of recyclable material collection points). No further details are provided in the RPs with respect to these items.



With respect to the population served by the collection system, EUROSTAT (Waste Generated and Treated in Europe, 1995-2003 Data Series) reports 100%. Effectively, this is the policy consideration, although, as indicated above, about 10% of MSW generated is not part of organised collection as it corresponds to mountainous, isolated and low populated areas.

Waste Transfer Networks:

A key need identified by RPs is the establishment of additional Waste Transfer Stations (SMA in Greek) as part of each integrated regional waste management system. Requirements (including financial investment estimates) as per RPs are as follows: 6 additional SMA 2.3 million € in North Aegean; 4-5 additional SMA 6.8 to 12 million € in Western Greece; 8 SMA (estimate 16 million €) in the Peloponnese; 4 SMA 3.5 million € in Epirus; 6 SMA 7.97 million € in Crete; 4 central SMA plus 18 smaller local ones in Attica, investment estimate 55 million €; 10 additional SMA 7.2 million € in Central Macedonia; 10 SMA 60.2 million € in Continental Greece; 6 SMA 2.45 million € in the Ionian Islands. No needs with respect to Waste Transfer Stations are identified in the Regions of Thessaly, Eastern Macedonia and Thrace and in Western Macedonia as these are fully covered through investments in the current programming period.

Overall, RPs identify the need for the establishment of a total of 77 Waste Transfer Stations (SMA) in nine Regions, with a total estimated investment of 166.7 million €. This would be considered as an average scenario.

5.2.3.2 Waste Sorting and Recovery

As indicated above, practically all RPs highlight the need for the establishment of new or the expansion of existing separate collection services that are linked to recovery facilities and selection at source programmes. Physical and financial investment needs with respect to sorting and source selection facilities are not as such identified, and often their cost where identified is included in the respective recovery or disposal facility’s estimated investment cost. Notably for mechanical waste sorting facilities, where proposed in the RPs, these are planned as part of sanitary landfill sites (e.g. Epirus) or recycling yards and composting plants (e.g. Attica, Eastern Macedonia and Thrace).

Selection-at-Source:

Practically all RPs mention the need for selection-at-source programmes to be established or, where existing, to expand. Such programmes include separate collection linked to the establishment of recycling facilities, currently applied for packaging material (see below). A particular issue for the next programming period would be the provision of separate collection facilities for organic (biodegradable) waste, currently non existing, in particular given the emphasis on recovery of biodegradable material and related targets mentioned above.

RPs do not indicate explicit targets for source selection (with the exception of the Attica RP), however several RPs estimate the investment cost for the separate collection services linked to recycling yards (KDAY, see below, does not include organic/biodegradable waste collection) to be 700,000 € per 100,000 inhabitants (e.g Crete, Central Macedonia, Western Greece, Continental Greece and others). It is noted that the respective indicative operational cost is 350,000 € per year per 100,000 inhabitants.

The Attica RP estimates the investment need for the additional implementation of the selection at source programme at 30 million €. Attica covers 32% of the country population. Given the low percentage of recovered/recycled waste (8.8% of total MSW) and the significant increase (41% to the year 2013) anticipated for packaging material generation, it would appear reasonable to assume a target of 50% population coverage through separate collection for the remaining population to the year 2013. On the basis of the above unit costs, this would reflect an additional infrastructure indicative cost of 26 million euro,



bringing the total indicative estimate (i.e. including Attica) for separate collection (selection at source) to 56 million euro.

Recycling Sorting Centres:

RPs identify the need for the establishment of 15 additional Recyclable Material Sorting Centres (KDAY in Greek): 2 in Western Greece, 1 in Epirus, 3 in Attica (cost indicated 18 million), 8 in Central Macedonia, 1 in Thessaly (cost indicated 15 million €). Other RPs indicate the need for expanding the capacity of existing KDAY (e.g. Crete) however no targets are provided.

Costs are not identified in all cases, however several RPs provide or use the estimate of 1.2 million per 100,000 inhabitants for KDAY infrastructure investment cost, while the respective operational cost is estimated at 600,000 per year. If we assume, as a minimum scenario, that for each of the Regions mentioned above where costs are not provided (i.e. Western Greece, Epirus and Central Macedonia) 50% of the population be covered through a KDAY unit and apply the above unit costs, then the indicative cost estimates would be 4.2 million for Western Greece (for 350,000 inhabitants), 2.04 million for Epirus (for 170,000 inhabitants), and 10.8 million for Central Macedonia (for 900,000 inhabitants).

Overall, the number of recycling centres (KDAY) explicitly identified in the RPs is 15, for 4 of which the estimated total cost as per the respective RP is a total of 33 million €. In line with the assumptions and calculations above an additional 17 million would be required as a minimum scenario for the other 11 recycling centres, raising the total indicative cost estimate to 50 million. As a cross-check, it is noted that this figure corresponds to infrastructure covering an additional nearly 40% of the total country population to the year 2013.

Biodegradable / Organic Waste Treatment Plants:

The main emphasis with respect to recovery in all RPs is the need to establish treatment plants for biodegradable waste materials in line with national targets. It is noted that currently only three organic waste treatment plants exist (composting), in Kalamata (Peloponnese) currently not in operation (undergoing upgrading infrastructure investment), in Ano Liosia (Attica) in pilot phase operation, and in Hania (Crete) – see details on capacity in section 4.2 above. The operation of these three units at full capacity is a top priority, according to YPEHODE, prior to further investment in treatment plants in the next programming period.

If any progress towards the targets on the reduction of land-filled biodegradables is to be achieved, the establishment of such plants is an utmost priority. It is noted that RPs provide initial proposals on number of plants and cost estimates, however no RP cites an available technical feasibility study, while most RPs mention the need for technical studies to determine the appropriate technology to be used, mainly biological treatment, as well as the appropriate location of the proposed unit.

The RPs therefore are to be considered as initial proposals for investment needs, subject to technical feasibility and economic viability studies prior to committing public funds on these projects. Such studies will require urgent funding to be developed, if the respective investments are to be realised within the 2007-13 programming period. It is noted that technical feasibility studies will need to be informed by studies on the quantitative and qualitative composition of waste per region (priority mentioned above), to determine both the appropriate technology and the viability of the investment. A general study on the national strategy to be developed with respect to achieving national/regional targets on biodegradables was scheduled to be launched in April 2006 within the framework of the OP Environment.

RP proposals and cost estimates with respect to biodegradable/organic waste recovery facilities are as follows:



• 5 composting units 5.4 mill. € linked to a selection at source programme in North Aegean;

• 1 composting unit and 3 units for mixed MSW treatment in Western Greece;

• in addition to investment required for the full-capacity operation of the existing composting plant in Kalamata, an additional unit for mechanical or biological treatment linked to energy production is proposed in the Peloponnese with an infrastructure investment cost of 33-35 million €;

• 1 organic waste treatment unit 10-12 mill. € in Epirus;

• 1 mechanical or biological treatment unit linked to energy production in Crete, estimated cost is 80 mill. €, capacity envisaged at 210.000 tn/year, while the operating cost is estimated at 40€ per tonne (i.e. double the operating cost of a similar unit proposed in the Peloponnese with less capacity);

• 3 composting units linked to source selection programmes in Attica 27 mill. €; an additional 3 mixed MSW treatment units are mentioned of undefined technology and no cost figures provided; an energy generation unit is also envisaged to be established at the mechanical recycling and composting unit (EMAK) at a 25 million € investment potentially private.

• 6 mechanical or biological treatment units in Central Macedonia, 235 mill. € (the indicative investment costs proposed range from 30,000 to 180,000 € and the operating costs between 40-65 € per tonne);

• 1 composting unit 5 mill. € in Thessaly;

• 1 pilot composting unit 3 mill. € proposed in the Ionian Islands in view of potential establishment of a total of 4 such units;

• 1 treatment unit 35.2 mill. € in Eastern Macedonia and Thrace, including a mechanical sorting unit, a composting unit, and an anaerobic digestion unit for the production of biogas;

• 1 treatment unit 25 mill. € in Western Macedonia for which a technical feasibility (to determine the technology) and financial viability study is currently being undertaken;

(No proposals are listed above for the Southern Aegean Region, as the Regional Plan was not available at the time of undertaking the needs analysis).

Overall, the 12 RPs proposals refer to a total of 28 treatment units of various technologies, notably: 11 composting, 6 mixed MSW treatment units and an additional 11 mechanical or biological treatment units. Indicative costs are provided for 10 composting units and for 10 additional treatment units of unidentified technology: total of 458.6 million euro. For the purposes of this study, this is the figure to be used as an indicative average scenario of investment needs in organic waste treatment for the 2007-2013 period, subject to technical feasibility and financial viability studies which are recommended to be undertaken as a priority and subject to the results of development of a national strategy on meeting targets on biodegradables (study anticipated to be launched in April 2006).

Additional Considerations:

It is noted that although in practically all cases, the technologies for recovery units have not been determined, the general orientation is for biological treatment (aerobic composting or anaerobic digestion linked to energy production) technologies, as these are more suitable for small to medium capacities as is the case in most Greek regions. Also, their operating costs tend to be lower than those of thermal treatment units which are more suitable (viability issue) for larger quantities of MWS. At this stage, the viability of thermal treatment (incineration with energy production) units are being considered in the cases of Crete, Central Macedonia, and the Peloponnese. These plans will, however, need to prove their



viability both in capacity and financial terms, and the only prospect given the very high operating costs would be for these to be implemented through Public Private Partnership schemes.

On the other hand, biological treatment technologies rely heavily on source separation systems. Costs for the collection of biodegradable material are relatively high, estimated at 50-80€ per tonne (ref. technical study of Northern Aegean Regional Plan for Solid Waste Management). This means that the cost of separate collection for organic/biodegradable waste in line with 2013 target would be estimated at 142.5 million euro.

The source separation programmes, notably the separate collection of organic/biodegradable waste would need to be accompanied by a public awareness and information campaign. The unit cost estimate for the initiation of such a campaign is 9 € per household and 7 € for its continuation (ref. technical study of Northern Aegean Regional Plan for Solid Waste Management). This would amount to 21.6 mill. € for initiating a campaign for 2/3 of Greek households (2.4 million) and 16.8 mill. annually for continuing the campaign (assume 50.4 million for 3 years).

Framework Factors Impacting on Waste Sorting and Recovery Investment Requirement:

It would be not justified to assume that the above can be implemented without:

(a) a significant increase in waste charges over the next programming period in line with the cost recovery policy;

(b) an acceptable system of linking waste generation and separation to the polluter, either in the form of incentives or disincentives / fines; and

(c) public private partnership schemes (PPP).

At this stage, YPEHODE (ref. Briefing Note on C502/03 dated 31/3/06) defines that PPP schemes should be concretely explored and identified by the operators (FOSDA). A very general reference is included in the NSRF Environment document (YPEHODE, December 2005) which indicates as an objective “the development of domestic industrial capacity for the treatment and management of hazardous and non hazardous waste”. It is recommended that the option of PPPs be an explicit strategic direction in the new National Strategic Reference Framework.

5.2.3.3 Waste Disposal

Sanitary Landfills:

To date in Greece the exclusive disposal route of MSW is landfills. An enormous investment effort over the past programming periods to comply with EU legislation on sanitary landfill conditions has resulted in the establishment of a total 101 new sanitary landfills, 45 completed as of March 2006 and an additional 56 under implementation. Complementing the above disposal facilities are a total of 54 Waste Transfer Stations (as part of regional waste management networks), 6 completed (in Western Macedonia) and 48 under implementation. The total public funds committed to the above projects amount to 492 million euro and come through the Cohesion and Structural (OP Environment and Regional OPs) Funds. They are planned to be completed by the end 2008, and serve 94% of the country population. (Source: YPEHODE, Waste Management Unit, Internal Briefing Note 31/03/2006).

RP proposals for additional sanitary landfills (i.e. excluding those for which investment has been committed through the 2000-06 CSF funds, some of which notably 3 in Attica are blocked due to public action as to their location pending supreme court decision) include: 1 SL 2 mill. € in the North Aegean; 1 SL 8 mill. € in Western Greece; 5 SL estimated cost 17



mill. € in the Peloponnese; 1 SL 5 mill. and expansion/upgrading of an existing SL 1.5 mill. in Thessaly; 3 SL 10 mill. and expansion/updrading of 5 SL 27 mill. € in Continental Greece; 1 SL 2.2 mill. and 7 small SLs 4.2 mill. in the Ionian Islands; and 3.6 mill. € for “mature” infrastructure and equipment works required for the Integrated Regional Waste Management System of Western Macedonia.

According to the RPs, therefore, there is need for additional investment in a total of 19 sanitary landfills, most of which concern small SL in island regions, amounting to 48.4 million €. Additional investment is also proposed for the expansion and/or upgrading of 6 existing landfills, amounting to 32.1 million €. For the purposes of this study, these needs will count towards the next programming period, although it cannot be excluded that funds towards these projects might be timely committed through current funds provided the projects fully mature in time.

Closure and Remediation of Illegal Disposal Sites (HADA):

It is noted that the specific project on closure and remediation of HADA started in 2004, when the relevant Ministerial Committee established for this project recorded a total of 2,626 HADA of which 1453 were still active. Of the total number, 2,081 could be immediately closed/remediated, while the closure of the remaining 545 dumpsites was subject to progress in the construction of sanitary (complying) landfills and related waste transfer network stations. The cost for the closure and remediation of the 2,626 dumpsites, of a total surface of 29,414 stremata (29.4 sq.km) was estimated (average scenario) at 413.5 million euro (Source: YPEHODE, Final Working Group Report on Promotion of HADA Remediation Projects, April 2005).

Given the recent (6 October 2005) conviction by the European Court of Justice (C502/03) for failure to comply with waste Directives with respect to the existence of 1,125 still active illegal waste disposal sites, the closure and remediation of HADA has taken absolute priority in investment effort for all regions in Greece, with the project being centrally planned and monitored by the Ministry YPEHODE. Towards this effort funds have been committed through programmes of the current programming period, including the Cohesion Fund, Regional OPs and the Environment OP (the latter through an internal transfer of funds from other measures of lower absorption rates). The closure and remediation of an additional 311 HADA that have been classified low-risk (YPEHODE) concern small-scale projects which are being implemented by the Municipalities through own funds. (Source: YPEHODE, Briefing Note, 31 March 2006).

As at 14 February 2006, a total of 240 HADA remediation projects were included in CF and SF programmes for a total budget of 70.5 million €, while as of 28 March 2006 the respective figures had risen to 277 HADA projects and a budget of 81.3 million €, showing the fast pace of implementation of this target. The end date for completion of the HADA closure and remediation programme is end 2008. (Source: YPEHODE, Briefing Note, 31 March 2006). Although also subject to the full completion of the sanitary landfill construction programme currently running, for the purposes of this study we assume that the specific deadline will be met in the sense that no further funds will be required for the HADA programme through the 2007-13 programming period.

5.2.4 Unit Investment & Operating Costs

Data on unit investment and operating costs where available and relevant for cost estimates have been indicated in section 5.2.3 above. Cost estimates provided in the Regional Plans integrate unit costs, and it is therefore not necessary to list them separately.

As discussed above, unit investment and operating costs will be critical in determining the appropriate technology for the treatment of biodegradable/organic waste to be applied in each case, depending on volume and qualitative composition of waste.




The Table below summarises the indicative cost estimates presented and analysed in section 5.2.3 above.

Table 5.2 Indicative Investment Requirement in Municipal Solid Waste

Type of Investment

Physical Needs Indicative Cost Estimates

(million euro)

Indicative CF/SF Requirement

Assumptions (million euro)

Organised sanitary cleaning of vehicles, equipment & facilities

No indication

Upgrading & renewal of equipment No indication

Waste collection facilities

Establishment of waste transfer stations as part of regional waste management networks

166.7 (assume 75%) 125

Separation-at-source linked to recycling yards

56 (assume 75%) 42

Biodegradable/organic waste separation-at-source

142.5 (assume 75%) 106.9

Waste sorting facilities

Public information and awareness campaign on selection-at-source programmes

71.7 (assume 75%) 53.8

Establishment of additional Recycling Sorting Centres (KDAY)

50 (assume 75%) 37.5 Recovery

facilities

Establishment of Biodegradable (Organic) Waste Treatment Units (composting or other technologies)

458.6 (assume 50%, PPP schemes) 229.3

Establishment of additional Sanitary Landfills (XYTA)

48.4 (assume 75%) 36.3 Disposal

facilities

Expansion/upgrading of existing Sanitary Landfills and related waste management facilities

32.1 (assume 75%) 24

Total Indicative Investment Cost Estimate

1,026 654.8

The total indicative estimated investment cost in municipal solid waste infrastructure over the 2007-13 programming period amounts to 1,026 million euro on the basis of the physical needs analysis presented in section 5.2.3 above.

This indicative cost does not take into account increases in levels of user charges, private investment through PPP schemes, or income generated through the operation of recovery facilities. Furthermore, this cost assumes that investment in disposal facilities – i.e. new sanitary landfills, closure and remediation of uncontrolled sites – as per current plans will be completed by the year 2008 through funds from the current programming period.

The indicative cost represents 0.08% of the projected annual GDP for the year 2007, dropping to 0.07% of the projected GDP for the year 2013.

It represents a significantly increased investment need over the current programming period, if compared to the 869.5 million euro planned Cohesion and Structural Funds investment in municipal and industrial (including hazardous) waste for the 2000-06



programming period. The 2000-06 planned investment represents on average 0.077% of annual GDP, however for both types of waste (i.e. including industrial and hazardous).

For the above indicative infrastructure investment cost, the Cohesion and Structural Funds intervention requirement for the purposes of this study is estimated at 75% as per past practice, with the exception of the organic waste treatment facilities where it is estimated at 50% assuming that these will proceed on the basis of large-scale public-private investment schemes which is likely to be the driving policy direction. It is, however, stressed that the financial allocations / requirements for EU funds have not been identified by the Member State at the time of writing this report. The figure provided in Table 5.2, therefore, is not but an assumption on the order of magnitude of potential funding requirements on the basis of regional needs (i.e. not strategic priorities) for comparative purposes. On the other hand, as presented relevant sections above, the physical infrastructure investment needs (as identified in the Regional Plans) that underpin these financial cost estimates stem directly from the need to comply with legislative requirements notably with respect to recovery targets.

This factor increases the relevant importance of the institutional context and related flanking measures highlighted above, such as the issuing of the legislation on the mode of organisation of the regional/local operators (FOSDA), the pricing policy to be implemented by them, the requirement for technical and financial feasibility studies to determine the appropriate technologies and location of organic waste treatment plants per Region, including relevant necessary studies for the quantitative and qualitative composition of MSW generated, and the elaboration of a strategy for the promotion of Public Private Partnerships for the realisation of MSW recovery schemes, notably with respect to the recovery of organic waste.




5.3.1 Initial Ranking of Priorities within the Municipal Solid Waste Management Field


Table 5.3 Ranking Types of Investment Within the Municipal Solid Waste Field (rank most important as 1)


Waste collection – Transfer Stations 1 Municipal Solid Waste Disposal – New/Upgrading of Sanitary Landfills 2

Recovery – Biological Treatment Plants 3

Waste sorting – Source Separation (including organic) 4

Recovery – Recycling Yards 5**



Closure and Remediation of Uncontrolled (illegal) Disposal Sites 1*

* The closure of uncontrolled (illegal) dumpsites is a first priority, however, as argued in the needs analysis section, this is the focus of current investment effort, expected to be completed by the year 2008. It is therefore assumed not to figure as a priority in the 2007-13 programming period. Hence ranking 1 is attributed to the establishment of waste transfer stations necessary to complete the integrated disposal management plans of certain regions.

** Recycling Yards is a high priority investment already in the current programming period, as is Waste Collection and Disposal. This ranking attributes the highest priority to any potentially outstanding infrastructure for waste collection and disposal that will not be covered through the current programming period, given the serious problem of legislative compliance. Following this, and given that the packaging material recycling target of 50% is nearly already met (see Needs Analysis) with infrastructure works under way, this ranking attributes a higher priority to the Recovery and Treatment of Organic Waste. It is judged that this is the key issue at stake with respect to municipal solid waste management for the next programming period if the 2013 target is to met, given that actual progress to date with respect to this target is lagging behind also with respect to planning.





As discussed in the Needs Analysis section (5.2 above), in the case of municipal solid waste, private investment is already directed in recycling, and it is also realistic to expect further private investment through the prospects provided by the newly established legislation on Public Private Partnership schemes. In fact, as analysed above, PPP schemes would be critical to cover the investment need requirement in the sector, notably with respect to the recovery/treatment of biodegradable/organic waste.

For the purposes of this study, the following assumptions are made:

(a) 50% of the indicative investment cost of 458.6 Meuro for recovery treatment plants (mainly biodegradable/organic waste) to be covered through private investment (Public Private Partnerships);

(b) 50% of indicative investment cost on recycling yards (total estimate 50 Meuro), on source separation of packaging material (total estimate 56 Meuro), and on source separation of organic/biodegradable waste (total estimate 142.5 Meuro) to be covered through private investment or purchase of recyclable material.

The above amounts to: 353.5 Meuro which represents 34.4% of the initial total investment need estimate.


For the municipal solid waste management sector, there is uncertainty over user charges and the degree to which these cover infrastructure, maintenance or operating costs. Issues



on cost recovery and cost calculation are addressed in the Needs Analysis section, which also identifies that the new legislation anticipated to be issued in 2007 will be critical to determine the framework of cost calculation and user charges towards full cost recovery in the future.

For the purposes of this study, on the basis of the argumentation already presented in the respective section of the chapter on water supply, we assume that a 1% share of average household income would be a reasonable level of municipal waste charges (that is, a total of 3% if combined with the water supply and waste water treatment). Furthermore, and given the requirement for full cost recovery, we assume that at least 20% of the total estimated investment requirement to the year 2013 could (or arguably should) potentially be recovered through user charges.

The above amount is estimated to represent 3.7% of total estimated revenue through these charges – the rest would be covering operating and maintenance costs.



For the purposes of this study, we will assume that the 37 to 40% absorption rate evident in current period Structural and Cohesion Fund environmental measures at large, applies also to the municipal solid waste management sector. As in the cases of water supply and waste water treatment, and on the basis of the same argumentation (see relevant sections of respective chapters), we assume that the fund absorption rate will increase to at least 60% over the next programming period.



Table 5.4 Estimate of the Financial Requirement for Municipal Solid Waste Management, 2007-2013




- 1,026 million Euro



34.4% (indicative assumption)

353.5 million Euro





205.2 million Euro

E: Financing Requirement



Before Absorption Review (A-B-C-D) (Meuro)

- 467.3 million Euro



(E multiplied by F)

280.4 million Euro



6 RENEWABLE ENERGY

6.1 Current Situation This section provides a brief analysis of the current situation in provision and infrastructure in the renewable energy sector. Details on investment through the Structural and Cohesion Funds are included in Annex A to this report. The institutional context and competences are presented in Annex B. Annex C includes a summary of relevant physical indicators.


The figure below depicts the cumulative capacity of renewable energy installed plants excluding large-scale hydro (owned and operated exclusively by the Public Power Corporation). It demonstrates an impressive acceleration of the renewable energy private market development over the past couple of years (2005-2006). This has been the result of the process of liberalisation of the Greek energy market and related institutional reforms as well as of targeted support measures.

982

747

69 69 69 7182

159

278350

368

483523

0,0

100,0

200,0

300,0

400,0

500,0

600,0

700,0

800,0

900,0

1000,0

up to1994

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Inst

alle

d M

W

WindSmall HydroBiomassSolar

Figure 2: Cumulative capacity of renewable energy sources plants (excluding Large Hydro), Ministry of Development, 2005 Situation Report

In 2003, total renewable energy (RE) primary production in Greece was 1,549 thousand toe, representing a 15.6% share of total energy primary production (9,893 thousand toe in 2003).



Renewable energy sources represented 3% of total installed electric power generation capacity.

The contribution of electricity from renewables to total electricity production was 9.6% in 2003 (up from 8.4% in 1995) and is estimated to reach an 11% share in the year 2005 (6.36 TWh of an estimated total electricity production of 57.8 TWh in 2005).


The Table below presents 2003 and 2005 data on renewable energy installed capacity and energy production.

Table 6.1 Renewable Energy Supply

Renewables Type Installed Capacity (in MW)) Energy Generation

2003 2005 2003 (in toes) 2005 (in TWh)

Wind 420 621.70 88,000 1.70

Large Hydro 3,060 3,017.80 4.16

Small Hydro 66 99.86

410,000

0.30

Biomass 27 23.72 945,000

Geothermal NA 0 1,000

Solar electric (PV) 0 1.15 0

0.20

Solar thermal - - 105,000 NA

Sources: EUROSTAT (2003 data on generation), Ministry Ministry of Development (2nd and 3rd National Reports on Penetration Levels of Renewable Energy Sources.

The highest share is from the large hydro-electrical installations owned and operated by the Public Power Corporation (PPC): 6.3% of total energy consumption needs (including imports). All other types of Renewable Energy Sources (RES) combined account for 3.1% of total energy needs (wind, small hydro, biomass and PV). (Source: Third National Situation Report on Penetration Levels)

Other than large hydro, wind energy maintains the highest share with a total existing capacity of 622 MW and with an additional capacity of 590 MW of installations that have already received authorisation. A further capacity of 1,240 MW concerns wind park investments through initiatives that have already been launched, mainly through Structural Fund and National Development Law support measures. (Source: Ministry of Development, Third Situation Report, 2005). Wind energy generation was 3,000 toe in 1995 and has since been doubling annually. The sector has been classified among those on which Greece has a distinct competitive advantage and significant growth potential.

The Photovoltaic (PV) sector has only recently attracted investment, although it is also identified to have a significant growth potential and there is strong investment interest from the private sector. Investment in PV will largely depend upon a favourable feed-in tariff regime, anticipated to be introduced in forthcoming legislation.

With respect to solid biomass, with the exception of wood and wood waste, the sector is not developed and investments are still at a pilot stage. 96% of the 2003 energy production figure indicated in the table above comes from wood and wood waste, the rest from biogas generation. One significant pilot investment plan has been recently announced in the Department of Evros (Region of Eastern Macedonia & Thrace) concerning the production of electricity and heating, capacity 6,380 KW, using biomass from agricultural production of 45 thousand stremata. This is a sector with growth potential given that Greece possesses important agricultural and forestry residues (estimated at 3 million toe for agriculture and 1



million toe for forestry. However, the wide range of biomass raw materials and the strictly local character of production and sale add to the difficulties of developing the necessary methodologies for the evaluation of the exploitable potential of biomass both technically and economically.

Solar thermal concerns mostly thermosiphonal water heating applied mainly in households. Installed capacity in terms of solar panel area was 3,246 sq.m. in 2004 representing 22% of total EU-25 installed capacity (EUROSTAT). Solar water heating is practiced by 25% of total number of Greek households (NSS). The diagram below depicts trend in solar collectors installed capacity and generation over the period 1999-2000.

Figure 3 Installed Capacity of Solar Collectors for Water Heating (Source: NCESD Environmental Signals Report)

An additional renewable energy source that support measures (ERDF and NDL) aim to promote is the use of passive solar systems in building construction. Buildings account for 40% of energy consumption nationally.

The contribution of geothermal energy is negligible at this stage, with no notable investment interest in the sector. The estimated investment unit cost is comparatively very high: 880 thousand Euro/MWe. However, Greece disposes abundant high and moderate euthalpy fluids, in some areas (i.e. islands of Milos and Nisiros) at economically exploitable depths of 1 to 1.5 km. Other areas include islands of the North and South Aegean Regions, as well as areas in the Western Macedonian & Thrace Regions.

Finally, with respect to biofuels, the legislation setting targets for their share in domestic market was submitted to Parliament in November 2005. The share of bio and other renewable fuels will thus be set at 5.75% of total transport fuel consumption as a target to be achieved by the year 2010. The necessary institutional (i.e. licensing issues) and support (i.e. tax exemptions) measures towards achieving this target are also addressed by the new legislation.

6.1.3 Renewable Energy Pricing and Support Issues

The energy market in Greece is in a process of liberalisation. At present the only grid supplier is the Public Private Corporation (PPC), recently privatised. The PPC is under obligation to purchase RES produced electricity at rates that are determined by the legislative framework. The sale price to the end consumer follows the general rates of the PPC – that is, there is not as yet distinction with respect to RES production. The new legislation anticipated to be issued within the first quarter of 2006 is expected to provide a



more favourable pricing policy for RES produced electricity in view of stimulating private investment in the sector and accelerate progress towards meeting the 2010 target - 20.1% RES contribution to total electricity consumption. (The legislation was passed through Parliament at the time of producing this report, in June 2006. Details on the old and new pricing policy are presented in Annex E of this report).

The two main instruments for providing public financial assistance to RES investment projects are the EU Structural Funds through the Operational Programme on Competitiveness, and State subsidies provided through the National Development Law (see details in Annex A of this report).

Business activities that are eligible for a subsidy (grant of 30-40% of total investment) under the NDL include: production of biofuels or solid fuels out of biomass, production of biomass for use in energy production, production of electricity from solar, wind energy, geothermal, biomass and hydro.

Under the Operational Programme on Competitiveness, public funding of total eligible RES investment cost is: 30% in the case of wind parks and conventional solar thermal units (not for households); 40% for small hydro, biomass, geothermal, high-tech solar thermal units and passive solar; and 40-50% for PV. The minimum private investment cost required is 44,000 Euro.

6.2 Analysis of Future Needs This section provides an analysis and independent assessment of physical investment needs for the 2007-13 programming period. It follows the methodological guidelines provided to the national evaluator by the central study team and aims to respond to the key questions identified by the central methodological framework of this study.


Renewable Energy is a prominent component of energy policy in Greece, which is furthermore inscribed as an integral part of the national development policy. Policy responsibility falls under the Ministry of Development and supporting instruments are developed and implemented as part of regional development strategy.

Greece has fully subscribed to the indicative target of 20.1% renewable share of total electricity consumption in the year 2010, as set for the country in the EU Directive 2001/77/EC. This target has since been the key focus of policy efforts and programme investments, and will continue to drive investment needs and priorities in the 2007-2013 programming period.

An additional driver to meet this target is the increasing level of CO2 emissions of the energy sector: at 10% below EU-15 average in 1990, they increased to 10% over the EU-15 average in 2000 (NCESD, Report on Sustainable Development Indicators).

The Ministry of Development (National Situation Report) reports on an annual basis on progress towards achieving this target and produces accordingly updated forecast estimates (basic, optimistic and conservative scenario) informed by the most recent developments in the sector and in the economy at large.

As a result, the development of the sector has spectacularly accelerated over the past few years and is expected to continue more so, given the concomitant policy measures towards the full deregulation of the energy market in Greece to be completed in 2007. The sector is considered to have most significant growth potential and to be a considerable driver of regional economic development, notably for certain regions with competitive advantage in solar and wind sources.

As part of the energy sector deregulation, recent legislation (June 2006) on Renewable Energy Sources and Cogeneration aims to simplify procedures for the issuing of permits to



private investors and increases the guaranteed grid purchase price. This is expected to facilitate and accelerate the realisation of investment, given the strong private sector interest.

An additional measure that will facilitate and accelerate the realisation of investments in the sector is the Special Spatial Plan (SSP) for Renewable Energy Sources currently being elaborated. The RES SSP will specify the directions for sustainable development and the organisation of the national space with respect to the spatial structuring of Renewable Energy Sources’ (RES) power generation by RES category, taking into consideration impact at local level. This is expected to address current issues of local community opposition as to the location of certain installations, an issue which is currently impeding implementation of approved (licensed) investments.

6.2.2 Review of Instruments and Support Schemes

Subsidy support schemes are in place as an incentive for private investment in RES for electricity production. These are realised through EU Structural Funds interventions (both through the 2nd and 3rd CSF) and through the National Development Law incentives (for details see the National Overview Report). The average capital subsidy is approximately 40%. In addition, there are interest rate subsidies in the order of 40% of interest paid on loans, and tax deductions.

EU Structural Funds assistance through the current programming period (2000-2006) is realised through the Operational Programme Competitiveness and is considered instrumental for the impressive acceleration of investment in RES over the past few years.

Actual approved investment through Measure 2.1.3 of the OP Competitiveness to March 2006 amounted to a total budget of 578.7 million euro (of a total planned budget of 869.8 million euro) for a total of 116 projects and a capacity of 543.85 MW. 70% of this investment concerned wind parks. An additional total budget of 381 million euro is earmarked through Measure 6.5 of the OP Competitiveness concerns projects for the connection of renewable energy producers to the grid and for co-generation projects (further details in Annex A).

Furthermore, approximately 32 million public funds (including ERDF support) are provided as capital subsidies through the National Development Law for RES projects.

It is noted that the above-discussed investment support does not concern the large-scale hydro-electrical installations as these are part to the Public Power Corporation’s investment plans (PPC currently operates as a private company following deregulation of energy market).

The recent legislation on RES discussed above is anticipated to provide an increase in the grid-purchase price as a further investment incentive (further details in Annex E).

Two key barriers are identified in the realisation of RES investment, both of which are currently being addressed:

Cumbersome and lengthy administrative procedures for the issuing of permits – average length of period to issue a permit is reported at 860 days. This is the key problem that is being addressed by the new legislation.

The second barrier concerns the lack of spatial planning which results into problems and local opposition (often leading to legal action) as to the location of the RES installations. The elaboration of the Special Spatial Plan on RES currently underway (discussed in section above) is expected to promote RES by priority after taking into consideration the local impact and simplify as well as shorten the procedures of physical planning for the construction of RES installations.



6.2.3 Supply and Demand Forecasts

The estimated 2020 share of households and tertiary sector in total energy demand will remain stable (37%), but in absolute terms it is estimated to increase substantially: by 50% in the year 2010 over 1995 demand, and by 80% in 2020 over 1995 demand.

The recent acceleration of growth in the renewable energy sector is attributed mainly to the impact of the recent institutional reforms and simplification of administrative procedures, which simplified the investing environment compared to previous years by lifting a number of barriers and delaying factors. Additional current institutional and supporting measures as discussed above are expected to further accelerate the process in the future.

Table 6.2 below provides updated information current capacity and generation and identifies the share of each RES type in meeting the 2010 target. The information is provided by the Ministry of Development in its annual (2005) RES Situation Report and relies on extensive analysis of actual and accurate data on realised and on planned (i.e. approved permit requests) investment expenditure and on electricity consumption trends and projections (produced by the PPC for planning purposes).

On the basis of these data and an analysis of investment trends, the report further provides three supply scenarios for the target year 2010. Table 6.2 depicts the basic scenario, which shows that the 2010 target is most likely to fall short by 2 percentage units (i.e. achieve 18.10% RES share in electricity consumption). The conservative scenario identifies 14.92% and even the optimistic scenario still falls slightly short of target (19.79%).

Table 6.2 Renewable Energy Existing and Future Supply

RES Type Installed Capacity (MW) Energy Generation (TWh) RES % share

January 2006

Target 2010

Estimate 2010

January 2006

Target 2010

Estimate 2010

2010 Target & (Estimate)

Wind 621.70 3,372 3,017 1.70 7.09 6.34 10.42 (9.33)

Large Hydro 3,017.80 3,325 3,325 4.16 4.58 4.58 6.74 (6.74)

Small Hydro 99.86 364 252 0.30 1.09 0.76 1.60 (1.11)

Biomass 23.72 103 71 0.81 0.56 1.19 (0.82)

Geothermal 0 12 8 0.09 0.06 0.13 (0.09)

Solar electric (PV) 1.15 18 10

0.20

0.03 0.01 0.03 (0.02)

Total 3,764.23 7,193 6,683 6.36 13.67 12.31 20.10 (18.10)

Source: 3rd National Report Regarding the Penetration Level of Renewable Energy Sources up to the Year 2010, Ministry of Development, October 2005

As an indication of short-term trends, it is noted that a capacity of 2,496 MW concerns RES production authorisations in the mainland without installation authorisations or with installation authorisation awaiting the completion of works for grid reinforcement. This would mean that a likely 780 MW capacity will be operational in the year 2010. In addition, seven hydroelectric plants planned to be commissioned by the PPC by 2010 have a capacity of 622.1 MW.



6.2.4 Costs of Infrastructure / Technologies

Unit investment costs per type of RES are established by the Ministry of Development to determine eligibility of investment proposals. They are presented in the Table below.

Table 6.3 Unit Investment Cost per Type of Renewable Energy Source

RES Type Unit Investment Cost

Wind 900 € per kWe

Large Hydro -

Small Hydro 1,100 to 1,500 € per kWe

Solid biomass 750 to 900 € per kWth for tele-heating tele-cooling

1,600 € per kWe for cogeneration (electricity – heat) from agricultural residue

1,300 € per kWe for cogeneration from treated waste water sludge

1,500 € per kWe for cogeneration from industrial and municipal solid waste

Liquid biofuels 500 € per tonne

Geothermal Applications on glass: 100,000 € per stremma (1,000 sq.km.)

Applications on plastic: 60,000 € per stremma (1,000 sq.km.)

Solar thermal 300 to 500 € per sq.m.

Solar electric (PV) 8,800 € per kWp

Source: Ministry of Development, OP Competitiveness Managing Authority, Note 13 March 2006


In Table 6.4 below an indicative investment requirement is identified for meeting the 2010 renewable energy capacity target on the basis of the unit costs presented in section 6.2.4 above. This figure will be used as an indication of 2007-2013 investment requirement for the purposes of this study, given that, as discussed above, the 2010 target is unlikely to be met even in the case of an optimistic scenario. The 2010 target will therefore be used as a 2013 target for the purposes of this study.

Table 6.4 Indicative Investment Requirement for 2010 Renewable Energy Target

RES Type Target 2010 (MW)

Average Unit Cost Applied (euro)

Total Indicative Investment Requirement (m euro)

Wind 3,372 900 3,035

Large Hydro 3,325 1,100 (est.) 3,657

Small Hydro 364 1,300 473

Biomass / Biofuels 103 1,300 134

Geothermal 12 80,000 960

Solar electric (PV) 18 8,800 158

Total 7,193 8,417



If we exclude the indicative investment requirement of large hydro which falls within the responsibility of the PPC, then the investment requirement to meet the target at least by the year 2013 is estimated at 4,760 million euro.

It is clear that not all of this investment can be assisted/promoted through public funds, and as acknowledged in the RES Situation Report investment using purely private funding will be necessary. Other measures will therefore become necessary and critical for meeting the target, such as facilitation of investment realisation through legislation (definitive alleviation of administrative bureaucratic burden) and spatial planning, tax incentives, facilitation of bank financing, continuation of the feed-in price regime (Source: Situation Report).

Public support schemes will also need to better target in the future certain RES with significant growth potential. The notable case is wind, where already the bulk of the assistance is directed (70%) given Greece’s competitive advantage in this sector. Equally, biomass, the exploitation of which is significantly lagging behind at this stage, has significant potential and is also linked to issues that need to be addressed with respect to the waste and waste water treatment sectors. These could provide for win-win situations. The considerable private investment interest expressed in the PV sector could also receive specific support.




6.3.1 Initial Ranking of Priorities within the Renewable Energy Field

The analysis and key arguments upon which the ranking is applied are discussed in section 6.2 of this chapter (Needs Analysis), the prevailing criterion being support and development of the renewable energy sector to increase the national share of electricity from renewables (2010 target). Ranking is applied as per the central methodological framework of the evaluation study.

Table 6.5 Ranking Types of Investment Within the Renewable Energy Field (rank most important as 1)

Field Type of Investment Ranking

Wind 1

Renewable Energy Hydro (>15 MW) 2

Hydro (<15 MW) 5

Solid biomass 3

Liquid biofuels 4

Geothermal 7

Solar thermal 8

Solar electric (PV) 6







Investment on large hydro electrical plants (total indicative cost 3,657 Meuro) is undertaken as part of the Public Power Corporation (PPC S.A.) private investment plan.

With respect to the remaining 4,760 Meuro indicative investment requirement for the other RES, we assume that 37% will be covered exclusively by private investment. This percentage represents the level of private investment in renewable energy sources that also receives public fund support through current schemes (see Needs Analysis section above and Annex A). This percentage is only used as an indication, but as acknowledged in the 2005 Situation Report on Penetration Levels (Ministry of Economy and Finance), it would be necessary for part of the private investment to be realised without public funds support if progress is to be made towards the 2010 target (discussed in section 6.2.5 above).

On this basis, the total indicative amount estimated to be covered through private investment is (3,657 + 1,761.2) 5,418.2 Meuro which represents 64.4% of the initial total indicative investment cost.


The method applied to calculate the indicative amount to be recovered through user charges is based on the difference between the per kWh grid sale price of RES produced electricity (i.e. the amount recovered by the private investor) and the actual PPC sale price to the end consumer. This is then multiplied by the total electricity generation (kWh) estimated over the period 2007-2013 in view of meeting the established 2013 target (as per data provided in Table 6.2 above).

The average grid sale price as of 1st August 2006 is 0.073 Euro/kWh (for details on prices see Annex E to this report), while the average consumer tariff is 0.098 Euro/kWh (Γ22 consumer tariff of the PPC as of 1st August 2006, for details see Annex E). The difference amounts to 0.025 Euro/kWh. Over the 2007-2013 period, this kWh tariff difference is estimated to amount to 1,661.2 million Euro.


As discussed in the Overview Chapter (details also in Annex A) of this report, There are no issues with absorptive capacity with respect to the renewable energy sector. In fact, in the current programming period, following a revision in 2005 funds were re-directed from other energy-related measures of the Operational Programme Competitiveness to RES-related programme measures. For the specific measure, committed funds to date (March 2006) are at 75% of total planned budget.

For the purposes of this study, and given also that the recent legislative improvement aim to simplify and accelerate the administrative procedures linked to the issuing of licences and permits, we will assume a 100% rate of absorption for the next programming period.





Table 6.6: Estimate of the Financial Requirement for Renewable Energy, 2007-2013




8,417 million Euro



64.4% (informed assumption)

5,418.2 million Euro




19.7% (informed assumption)



-


F: Absorptive Capacity (% of Financing Requirement (E)) 100% (informed assumption)


(E multiplied by F) 1,337.6 million Euro

Strategic Evaluation of Environment and Risk Prevention Under Structural and Cohesion Funds, 2007-2013 – National Evaluation Report on GREECE – Draft Final

GHK, ECOLAS, IEEP,CE 75

7 NATURAL RISK MANAGEMENT (FIRE, DROUGHT, FLOODS)

7.1 Current Situation This section provides a brief analysis of the current situation with respect to the management of the risks associated with the natural hazards of fire, drought and flooding. Details on investment through the Structural and Cohesion Funds are included in Annex A to this report. The institutional context and competences are presented in Annex B.


Management responsibilities are divided between different bodies and levels of government per type of natural risk. The General Secretariat for Civil Protection (GSCP), under the jurisdiction of the Ministry of Interior and Public Administration, has overall coordinating responsibility for the development of natural hazard protection plans. The GSCP is also responsible for liaising with other EU and international organisations on civil protection.

Overall, there is no comprehensive approach towards natural risk management at national level. Also, there is no overall integrated policy towards natural risk assessment and management planning. Civil Protection Offices are currently in the process of being established in all central government departments (Ministries) and regional and local authorities, in an effort to improve coordination in risk management and response planning at national level.

7.1.1.1 Fire and Heat Waves

Fire, often as a result of long periods of heat wave, are a high-risk natural hazard in Greece. The majority (72%) of fire incidents occur in forest and semi-natural areas (forests cover 22% of total country surface); 26% of fire incidents occur in agricultural (i.e. cultivated) areas; and the remaining 2% in built environments.

Overall, significant investment over the past years has been directed to fire prevention and management schemes, both for physical infrastructure and management plans. This investment effort has rendered significant results both in number of fire incidents and in surface of forest and/or rural area affected.

The number of fire incidents dropped from 235,737 to 183,423 during the decade 1991-2001. A most impressive drop was witnessed in the year 2002 (43,370 incidents or a drop of 76% over 2001 level), also as a result of institutional reforms with respect to forest area fire management and protection. During the period 2002-2005, the number of fire incidents has been steadily declining annually, dropping impressively by an additional 79% overall. A steady decline in the total surface area affected by fire incidents is also recorded: a 35% decrease in 2005 over 2004 level.

Fire 1991 2001 2002 2003 2004 2005

No of Incidents 235,737 183,423 43,370 34,959 9,866 9,181

Area affected (in stremata, 1/10ha)

- - - - 125,966 81,293

Sources: National Statistical Service, General Secretariat for Civil Protection

Historic data on surface area affected by fire incidents for the year up to 2001 is presented in the Figure 1 below, while the reforestation effort is depicted in Figure 2.



Figure 3: Surface Area Affected by Fire Incidents (Source: Centre for the Environment and Sustainable Development, Environmental Signals Report)

Figure 4: Surface Area Destroyed by Fire Incidents and Reforested Area (Source: Centre for the Environment and Sustainable Development, Environmental Signals Report)

7.1.1.2 Drought and Desertification

Droughts in Greece are associated with long period of heat waves, resulting – in association with the impact of fire incidents - into the desertification phenomena that have started to be evident in areas of the central and southern Greek mainland, in the Aegean islands and in Crete. It is estimated that a total of 15,000 sq.km or 11.5% of



total country land surface corresponding to 800,000 inhabitants is beginning to show signs of desertification.

On the other hand, Greece is identified as a low water stressed country (Source: European Environmental Agency, 2003). The Water Exploitation Index (WEI, i.e. mean annual total demand for freshwater divided by the long term average of water resources) for Greece was 24 in the late 1990s. The proportion of annual renewable freshwater resources stored in reservoirs was 17% in 2001 – the majority used for hydropower. However, the water consumption index is comparatively high (WCI=10 in late 1990s) due to agricultural use.

The impact of intense heat waves and dry seasons has resulted into a total of 23.8 million of damage compensations to farmers during the 1999-2004 period (or nearly 4 million annually on average).

7.1.1.3 Floods

The most common flooding incidents in Greece are sudden floods as a result of rain storms. These affect both rural and urban areas, in the former often causing mud slides, resulting into serious damages in housing, road infrastructure, farming corps and animal stock.

In rural areas they are mostly the result of reduced forest and natural land surface, as well as improper preservation and protection of these areas and natural water outlets (i.e. torrents). In urban areas they are mostly linked to problems of the sewerage system: combined sewerage overflows, improper maintenance of the portals.

Compensation for damages incurred by farmers due to floods amounted to 30.8 million Euro for the six-year period 1999-2004 (or 5 million annually on average) and accounted for 2.8% of total compensations to the agricultural sector as a result of weather-related natural hazards.

Increasingly in recent years, the flooding of cross-border rivers, and notably the river Evros 60% of whose catchment area is in Bulgaria, is becoming an increasing risk. The most recent (March 2006) flooding of the Evros river caused significant damages in the three countries sharing its catchment area - Bulgaria, Turkey, Greece. In Greece, it caused damage to at total of 300,000 stremmata (300 sq.km.).

Significant funds on flood prevention measures are invested in the current programming period notably through the operational Programme on Agricultural Development (actual investment to date 429 Meuro, see Annex A to this report). However, a high level of request is evident for flood prevention measures in non-rural areas as well – the proposals submitted following a tender for funding through measures 6.1 and 6.2 of the Operational Programme Environment concerning flood protection in urban and mountainous areas amounted to a total budget of 700 Meuro. The actual planned budget of these measures is 60 Meuro. (Source: Managing Authority EPPER). This is an indication of higher level of need than currently being addressed

7.1.2 Existing Risk Assessments

Although risk assessments and emergency response structures exist for individual type of hazards, there is lack of an integrated strategy and approach to natural risk management at national level. Neither the institutional context, nor the necessary tools (e.g. mapping and risk analysis, integrated planning, administrative system for risk management interconnecting the agencies involved) are available. In the field of civil protection, this is identified as a key investment priority for the next programming



period (Source: 2007-13 Programming Period – Thematic Seminar on Sustainable Development, December 2005).

It is noted that the first Integrated Information System on Civil Protection from Natural Hazards is currently being developed through the National Operational Programme Information Society.

Risk assessment methods and tools are more developed and applied in the case of fires and heat waves. No specific risk assessment tools have been identified with respect to floods at this stage, however it is anticipated that the issues of flooding risks and management will be addressed through the Regional Water Management Plans currently being elaborated on a river basin basis (as per Water Framework Directive requirements, see chapter on water supply).

7.1.2.1 Fire and Heat Waves

Fire, notably in forests and rural areas, due also to the climatic conditions prevailing during the summer period, is clearly identified as a high-risk natural hazard and is addressed with appropriate prevention planning measures.

By Law 157/9 of 1980 and related Presidential Degree 575/1980, the period from 1st May through to 31st October of each year is identified as high risk and designated as “fire prevention period”. The Law prescribes the high alert and surveillance measures to be implemented during this period by all public agencies involved in fire prevention.

During the fire prevention period, the General Secretariat for Civil Protection (GSCP) issues a detailed Daily Fire Risk Forecast Bulletin covering all geographic regions of the country (at department and sub-department level); the Bulletin is available also through the GSCP public website.

The fire prevention period applies to the entire country. In addition, legislation (Law 998 of 1979) defines high-risk forest areas (defined according to boundaries of forest inspectorates of regions/departments).

Another fire high-risk factor identified and monitored through the GSCP, is the existence of a large number of uncontrolled (illegal) waste disposal sites. The GSCP reports 1,148 such sites across the country in 2005, 885 of which are located within or near the boundaries of high-risk areas (forests and natural meadows).

According to the legislation, the Fire Brigade which is the body responsible for the regulatory framework for risk prevention measures and for the development and implementation of emergency response plans, is allocated 30 million Euro annually through the public budget.

7.2 Analysis of Future Investment Needs This section provides an analysis and independent assessment of physical investment needs for the 2007-13 programming period. It follows the methodological guidelines provided to the national evaluator by the central study team and aims to respond to the key questions identified by the central methodological framework of this study.

In the absence of quantitative data available on existing (at national scale) or future physical infrastructure needs, unit or total investment costs, and risk forecasts, the analysis and assessment that follows is primarily informed by qualitative observations.




For national hazards overall there is no specific comprehensive policy. Also, competences and jurisdictions rest with different central and regional government services for different types of risks as well as for different required levels of response (preventive measures, emergency plan, emergency response, compensations, etc). (Institutional competences are presented in Annex B of this report).

Overall, with the exception of fire, policy objectives for natural risk mitigation and management at this stage are weak and there is no comprehensive strategy or planning on the issue. Most critically (again with the exception of fire) there are no systems in place for quantitative risk assessment and monitoring.

Investment efforts in the current programming period concern mainly flood protection, fire prevention and response infrastructure, restoring agricultural and forestry potential damaged by national disasters, and preservation / restoring of the natural environment. However, these measures are dispersed across regional operational programmes and the bulk of the investment does not come – in terms of planning - under an explicitly environmental dimension, nor under a comprehensive priority on risk management.

This issue is intended to be addressed in the 2007-2013 programming period: Civil Protection and Risk Management is intended to be one of the eight priority axes of the Operational Programme Environment and Sustainable Development. The same axis can also figure in the Regional Operational Programmes. (Source: Ministry of Economy and Finance Guidelines, June 2006). However, at the time of undertaking this study, the concrete qualitative and quantitative objectives and targets have not as yet been formulated.

7.2.2 Instruments and Support Schemes

No specific enabling measures or support schemes have been identified for natural risk management per se.

A number of concrete actions are currently undertaken by the General Secretariat for Civil Protection to enable the development of tools and mechanisms for risk assessment and mitigation. These include the following:

• A feasibility study is currently being developed (through national funds) to provide specifications for the mapping of natural (and technological) hazards that concerns the critical natural hazards in Greece – Fire, Flooding and Earthquakes. This will develop into a project for funding under the next programme period through EU funds.

• As part of the above study, data and data sources currently dispersed will be identified, with the objective to interlink this information into a single integrated information and monitoring system. It is planned to seek EU financing for the further implementation of this system, which as an absolute necessity in order to address data gaps, enable the analysis of collective and historic data, inform further policy and organise a risk monitoring system as first step towards risk assessment.

Gaps and barriers identified through discussions with the GSCP include:

• Need for comprehensive and consistent training in risk management and risk emergency response of administrative personnel concerned of various involved services. Such an initiative has started in 2006 for the first time with a training programme introduced in the National Public Administration School.



• The realisation of the integrated information and monitoring system will require infrastructure (equipment) investment across the relevant administrative services of all 13 Regions and centrally. The intention is to achieve real-time connection for exchange and update of information across administrative services and develop into emergency response operational centres that will also provide for early warning systems.

Overall, there is a clear need for overall policy to be formulated on the basis of prevention objectives (as opposed to disaster response and compensation).

For flooding in particular there is an absolute need to enhance cross-border cooperation and invest in coordination and response plans and systems. Greece has four cross-border rivers, two of which (Axios and Evros) have a large catchment area.

Information on flood risks and proposals for preventive measures are expected to be included in the Regional River Basin Water Management Plans expected to be completed in 2008 (for detailed information see chapter on water supply). It is critical that preliminary results of these Plans in the end of 2006 are used to inform investment requirements in the future programming period (recommendation argued in chapter on water supply.

Also, the NATURA projects face a pending issue as to the full operational capacity of the Managing Bodies which have only nominally being formed. Special protection areas in areas cover a surface of 27,641 sq.km. nearly 21% of the country surface.


Areas of investment are identified in section 7.2.2 above.

In the absence of quantitative data on physical and on financial investment needs, the indicative investment cost required to be estimated within the framework of this study will be estimated with the same method as in the case of water supply – i.e. on the basis of share in GDP of previous period’s estimated planned investment in this sector.

Total Cohesion and Structural Funds in fields related to risk prevention (flood protection, desertification, Natura 2000, forest and rural restoration as a result of natural hazards, agricultural water resources management) amounts to 940.6 million euro which represents 0.083% of GDP. (For details see Overview Chapter and Annex A of this report). If the same percentage is applied for the projected GDP of the period 2007-2013, then the estimated indicative investment cost is 1,087 million euro. Given the needs in the specific sector as presented above, it would be reasonable to assume that the same level of investment as GDP share be maintained in the next programming period.






7.3.1 Initial Ranking of Priorities within the Natural Risk Management Field

The analysis and key arguments upon which the ranking is applied are discussed in section 7.2 of this chapter (Needs Analysis), the prevailing criterion being the management and avoidance of natural risks with respect to fire, drought and floods. Ranking is applied as per the central methodological framework of the evaluation study.

Table 7.1 Ranking Types of Investment Within the Natural Risk Management Field (rank most important as 1)


Natural Hazards Risk assessment (mapping, methods, tools etc) 1

Flood – risk assessment, early warning, cross-border cooperation 2

Flood – anti-flooding infrastructure 3

Drought – desertification (linked to water resources management, see water supply field) 4

Fire – linked to heat wave 5

Storm 6





No evidence has been identified to indicate that there is scope to meet investment needs through market schemes in the Natural Risk Management fields of interest to this study.


It has not been possible to identify a direct link between investment in natural risk management and user charges. In the case of flood-prevention infrastructure, such a charge would be included in the water supply bill, however the link is not explicit, nor the share.


As discussed in the Overview Chapter of this report, the reported absorption capacity rate for both Cohesion and Structural Fund environmental projects is in the order of 37 to 40%. It is judged that fire and flood prevention infrastructure measures are more part of mainstream planning in comparison to other environmental sectors (i.e. water management, waste water supply or municipal solid waste management) – for



example, no location issues, simpler technology – and, therefore, have a higher rate of absorption. For the purposes of this study, we will therefore assume a higher absorptive capacity than the other three environmental fields for the next programming – estimate 80%.



Table 7.2: Estimate of the Financial Requirement for Natural Risk Management (Fire, Drought, Floods), 2007-2013




- 1,087 million Euro



0%

0




0% (lack of evidence to support other assumption)

0


1,087 million Euro



(E multiplied by F) 869.6 million Euro



8 CROSS FIELD PRIORITY ASSESSMENT

8.1 Introduction This chapter presents an assessment of the priorities across the five study fields using a Point Scoring allocation and a Mulit-Criteria analysis, as per the requirements of the methodological framework of the evaluation study (for the methodological guidelines that have been followed, see Evaluation Synthesis Report).

8.2 Point Scoring In the table below, the evaluator has been asked to share 100 points across the five study fields as a first indication of the relative importance of each field for the Structural and Cohesion Funds.

The point scoring being applied is based on the results of the independent analysis and assessment of needs and priorities undertaken per study field in the previous chapters of this report. Overall, the three main study criteria are applied: (a) compliance with EU environmental legislative requirements (environmental acquis); (b) conformance with other policies; (c) the overall need to promote regional and economic competitiveness and convergence.

Table 8.1 below summarises the argumentation in line with the central methodological framework guidelines, and attributes the related point scoring.

Table 8.1: Round 1 - Indicative Point Scoring Allocation Across Fields Based on Regional Development and Resource Management Arguments - Greece

Field of Investment

Main Arguments Indicative Points Allocation

Water Supply Legislative requirement; Efficient use of water resources; Response to improving quality of drinking water resources, benefits to health.


Legislative requirement; Response to health effects and essential environmental quality improvements; Essential provision of utility services; Response related to increased water use.

Municipal Solid Waste Management

Legislative requirement; Response to health effects and essential environmental quality improvements; Improve management of material resources due to increased use; Recycling and treatment aspects have potential for positive impact on economic growth and employment.

Renewable Contributes to competitiveness, regional economic



Energy development; Positive impact on employment; Response to increasing levels of CO2 emissions; Improved energy efficiency.

Natural Hazards Mitigate economic losses; Protection of natural environment and resources.

Other: Strategic Planning

Response to ensure adequate strategic management and planning, improve institutional capacity

All Fields

8.3 Multi-Criteria Analysis

In applying a multi-criteria analysis (MCA), the evaluator has been asked to assess each of the different types of investment for their contribution to specific criteria.

These criteria (listed in Box A below) reflect different benefits that the investment might be expected to contribute to.

Box A: Criteria for Scoring the Potential Impact of Different Types of Investment

Contribution of investment to:

1. securing compliance with the acquis (e.g. because of replacement of non-compliant treatment plant)

2. avoiding economic and social damages (e.g. because of reduced natural risks of flooding, fire or because of improved environmental quality, or because of increased security of supply)

3. encouraging new technology and market development (e.g. priming the development of local PV or passive solar market) with the potential to replace imports or generate exports

4. generating employment opportunities in line with national and regional employment goals (e.g. for employment in lagging regions, or in particular cities or in rural areas - because of improvements in environmental quality in particular areas or because of the location of utilities and construction firms)

5. providing employment and training opportunities for low skilled workers or ‘hard to reach’ groups (e.g. ethnic minorities, women, older workers)

6. promoting cross-border co-operation (e.g. management of cross-border flooding)

7. delivering national and regional environmental strategies and plans which



are well integrated with wider development strategies and plans (e.g. where environmental priorities are well linked to economic or social objectives)

8. promoting more cost-effective programme design and delivery (e.g. encouraging the use of public-private partnerships, or more effective procurement, or through use of well developed technologies which take account of subsequent maintenance arrangements)

The contribution of each type of investment to each criterion is indicated in Table 8.2 below using a simple scaling: very strong (10 points), strong (7 points), limited (3 points), negligible (0 points) contributions. The respective scores are entered into the ranking spreadsheet (Table 8.2).

Key deviations in the case of Greece from the default scaling provided by the central methodological framework of the evaluation study are identified in bold in the Table and are justified as follows:

• Water Supply: higher scoring on criterion 2 with respect to long and local transport, given the critical issue of leakages in water distribution; lower scores on criterion 8 given that water supply is considered a very basic utility provision related primarily to social and health policy issues.

• Waste Water Treatment: higher scoring on criterion 1 given that Greece has failed to meet the deadlines for the implementation of Directive requirements; also sludge disposal is a critical issue in Greece impacting negatively also on municipal waste management.

• Municipal Solid Waste: higher scoring on criterion 1 given that Greece has failed to meet the deadlines for the implementation of Directive requirements and is faced with a number of European Court convictions with significant (and in the future potentially more significant) economic penalties; higher scoring on criteria 7 and 8 given potential of recovery and treatment to economic growth and potential for public private partnerships.

• Renewable Energy Sources: lower scoring with respect to criterion 6 due to lower potential for cross-border cooperation on certain types of investment.

• Natural Hazards: lowering scoring in the case of flood with respect to criterion 4, as there are not many areas of very high exposure.



Table 8.2: Multi-Criteria Assessment for Greece (deviations from default scoring in bold)

Contribution of each type of investment to each criterion

Field Type of investment 1 2 3 4 5 6 7 8

Reservoirs 3 7 3 3 3 7 7 3

Drinking water production plant 10 7 3 3 3 0 7 (7) 3

Transport (inc leakage) - long 10 (7) 10 3 3 3 (7)3 7 (7) 3

Transport (inc leakage) - local 10 (7) 10 7 3 3 0 7 (7) 3

Water Supply

Metering 0 3 7 3 3 0 7 (10) 3

New STPs (7) 10 (7) 10 3 3 3 3 7 3

Renovation / upgrade STPs (7) 10 10 7 (7) 3 3 0 7 3

New Sewerage (7) 10 (7) 10 3 3 3 3 7 3


Renovation / upgrade sewerage 3 7 3 3 3 3 7 3

Sewage pumping stations 7 7 3 3 0 0 7 3

CSO upgrading 3 7 3 3 0 0 7 3

Sludge treatment (7) 10 7 7 3 0 0 7 3

Sludge disposal (7) 10 7 0 (3) 7 0 0 7 3

MSW Waste collection (7) 10 7 7 7 7 0 7 7





Waste sorting (3) 10 (3) 7 7 7 7 0 (3) 7 (7) 10

Recovery 7 (3) 7 7 (3) 7 3 0 (3) 7 (7) 10

Disposal - new disposal facilities 10 (7) 10 7 3 0 0 7 7

Disposal - remediation of existing (7) 10 10 3 3 3 0 (3) 7 3

Wind 3 7 7 3 3 0 7 7

RES

Hydro (>15 MW) 3 3 3 3 3 (7) 3 3 7

Hydro (<15 MW) 3 7 7 7 3 3 7 7

Solid biomass 3 7 3 7 3 (3) 0 7 7

Liquid biofuels 3 7 7 3 3 (3) 0 7 3

Geothermal 3 7 7 3 3 0 (7) 3 3

Solar thermal 3 7 7 0 3 0 7 3

Solar electric (PV) 3 7 10 0 3 0 7 3





Drought 3 10 3 3 3 7 7 10

Fire 0 10 3 3 3 7 7 10

Flood 7 10 3 (7) 3 3 10 7 10

Heat wave 0 10 3 3 3 3 7 7

Natural Hazards

Storm 0 7 3 3 3 3 7 7

Key: Very Strong Contribution: Score 10

Strong Contribution: Score 7

Limited Contribution: Score 3

Negligible Contribution: Score 0

Bold font indicates deviations from default table based on country specific needs analysis, default value appears in brackets



On the basis of the MCA scoring in Table 8.2 above, the relative contribution of each sector in the total scoring is:

• Waste Water Treatment 24%;

• Renewable Energy Sources 23%;

• Municipal Solid Waste 19%;

• Natural Hazards 18%;

• Water Supply 16%.

As a result of the MCA assessment, the scoring differences between fields become less marked in comparison to the initial Point Scoring (section 8.2. above) and the priority order changes.

Renewable Energy Sources (RES): the cumulative scoring of investment increases impressively as a direct result of their higher contribution across all criteria in comparison to the other sectors.

Natural Hazards: scoring also increases mainly due to its contribution to criteria 6,7 and 8 – that is, its contribution to cross-border cooperation and to integration with other development strategies and plans that are directly linked to economic and social objectives.

Water Supply: investment in this field reduces significantly in priority importance due to its overall lower contribution across all criteria in comparison to the other sectors.

Waste Water Treatment and Municipal Solid Waste: investments in these fields retain a high priority significance, but their scoring decreases in comparison notably to RES and Natural Hazards. This is the result of the legislative requirement (i.e. environmental acquis) being weighted equally with the other nine criteria, whereas in the independent point scoring assessment it has taken overriding priority.

8.4 Revised Point Scoring Allocation The initial point scoring (section 8.2 above) is revised on the basis of considerations resulting from the multi-criteria analysis. The revised point scoring allocation is presented in Table 8.3 below.

The revised point scoring allocation is informed by, but does not strictly follow the MCA assessment, as in the case of Greece it is judged (on the basis of the Needs Analysis presented in previous Chapters) that the legislative requirements (environmental acquis) in the fields of water supply, wastewater treatment and municipal solid waste need to be the over-riding investment criterion. The key arguments are summarised in Table 8.3 below.

With respect to water supply in particular, it is judged that the field investment priorities concerning the efficient management and use of water (as opposed to drinking water supply infrastructure) are an important prerequisite to be met also with respect to natural risks management (floods, drought, desertification) and in view of economic competitiveness and convergence.

With respect to renewable energy, on the other hand, given the significant contribution across all criteria evidenced by the MCA, the share of the investment requirement has been raised in importance in comparison to the initial allocation.

Furthermore, in the case of Greece, a 5% earmark on strategic planning and institutional and/or administrative capacity improvements is considered essential for the efficient and effective implementation of the investment requirement in all fields.



Table: 8.3: Round 2 - Indicative Point Scoring Allocation Across Fields Informed by Multi-Criteria Assessment - Greece

Field of Investment Main Arguments Indicative Points Allocation

Water Supply Lower contribution across all criteria, but water resources management issues as per Water Framework Directive will have important long-term impact on economic and regional growth. Also, issues are linked to and impact on natural risks, i.e. flood-management, draught- prevention measures.

15-20 17


The over-riding criterion remains need to comply with EU legislation as Greece has missed implementation deadlines

20-30 22

Municipal Solid Waste Management

The over-riding criterion remains need to comply with EU legislation as Greece has missed implementation deadlines with respect to sanitary landfills and has still to make significant progress with respect to 2013 targets on reduction of organic waste.

20-30 22

Renewable Energy Significant contribution across all criteria 15-25 20

Natural Hazards High contribution to integration with other development strategies and to promotion of cross-border cooperation, however water resources management (water supply field) takes priority as a prerequisite planning stage

10-20 14

Other: Strategic Planning

Response to ensure adequate strategic management and planning, and improvements in institutional capacity are critical to ensure effective implementation of investment priorities

5-10 5

All Fields 100 100

8.5 Indicative Investment Share by Region In Table 8.4 below the evaluator has been asked to provide an indicative percentage share of the total investment per field in each NUTS I level region. These estimates are based on the ranking of priorities within each field as presented in the relevant field chapters of this report, and is intended as a preliminary indication of importance of field priorities in each Region.

The following key considerations have informed the indicative regional allocation in the case of Greece presented in Table 8.4:

Water Supply: Problems of drinking water supply are more prominent in the Aegean Islands as there are issues of self-sufficiency in water resources and future impact of continued growth in tourism sector will increase demand. In Northern Greece, local issues of water quality need to be addressed (i.e. very specific to certain areas) as well as the depletion of groundwater resources. The latter is also a problem in areas of Central Greece. For all



regions, the issue of water resources management as per legislative requirements (Water Framework Directive) needs to be addressed.

Waste Water Treatment: Legislative compliance with respect to Priority B settlements will be a top priority over the next programming period and concerns settlements in the Attica Region. Planning the Priority C settlement compliance investment requirements concerns all other regions (precise investment needs per region can only be available once the Member State planning is completed).

Municipal Solid Waste: A higher level of investment share is allocated to Central Greece as there are two regions (the Peloponnes and Epirus) where the construction of new landfill sites (also to replace still operating illegal waste disposal sites) is likely to require funding in the next programming period. This is a priority issue as regards legislative compliance. The same (higher) level of investment is allocated to the Attica Region, and it is by far the biggest producer of municipal solid waste. The critical factor in determining future regional investment needs will be the planning (at national level), once completed, of the infrastructure needs for organic/biodegradable recovery and treatment.

Renewable Energy: There is great uncertainty in attributing (even indicatively) investment share by region at this stage, given that the Spatial Plan on Renewable Energy Sources currently in preparation will determine local potential and possibilities. A key factor that needs to also be taken into consideration is the relative competitive advantage of each region (at least at NUTS II level) with respect to the different types of RES (e.g. wind, hydro, biomass from agricultural waste). A very indicative allocation is provided in the table below considering at a very basic level this factor in combination with need for regional competitiveness and convergence.

Natural Risk Management: The evidence accumulated in the course of this study do not provide adequate pointers for distributing investment across regions. In the table below, a higher indicative share is allocated to the Aegean Islands and Crete as a result of more severe problems of desertification, and to Northern Greece in order to account for the need to address the problem of cross-border flooding management.

Table: 8.4: Indicative Share (%) of Field Investment by Region - Greece

Region (NUTS I) WS WT MSW RES NRM

Northern Greece 35 20 20 20 35

Central Greece 20 20 30 30 15

Attica 10 40 30 15 15

Aegean Islands and Crete 35 20 20 35 35

All Regions 100% 100% 100% 100% 100%



9 SUMMARY CONCLUSIONS

9.1 Key Issues for Consideration in 2007-2013 SC/CF Programming This section summarise the main issues for consideration by the European Commission in reviewing Greece’s 2007-2013 strategic and operational programme proposals.

9.1.1 Horizontal Issues

Updated quantitative indicators should be required per field and type of investment to reflect current situation and progress required towards quantitative targets and objectives.

9.1.2 Water Supply

Overall strategic issues need to relate to efficient water use and resources management.

Investment requirements to achieve progress towards the implementation of the Water Framework Directive need to be explicitly identified. These are likely to include investment in administrative infrastructure to improve management capacity, which would then need to figure as a priority prerequisite.

It is critical that the objectives and priorities in the sector are linked to the Regional River Basin Water Management Plans currently in progress (expected to be completed in 2008). It could be envisaged that the preliminary RWM Plans provide the basis for establishing (and/or justifying) investment needs and priorities at regional level. If not possible, then an explicit commitment should be made to undertake a review of sectoral objectives and priorities once the RWM Plans are completed.

The problem of water losses should be acknowledged and set as a top policy priority. If required, technical studies to back this evidence and identify appropriate solutions should be co-financed.

The evidence of the current studies on groundwater resources should be used to determine investment requirement in the sector. The replenishing of groundwater resources should figure as a policy priority.

Problems with water quality (resources) should be explicitly identified for the localities in which they occur, and the corrective measures should be determined at programme level.

Policy objectives with respect to the Polluter Pays Principle and full cost recovery should be explicit in the strategy.

9.1.3 Waste Water Treatment

Strategic priority should be explicitly attributed to outstanding Priority B and C settlements that need to comply with Urban Waste Water Treatment Directive.

Total sector investment requirement should be explicit with respect to the above strategic priority.

The completion of Priority C settlements planning currently in progress ((Ministry of Environment, Physical Planning and Public Works, regional and local authorities and local operators concerned) is an essential prerequisite to determine investment needs overall and per region. Investment requirements should therefore be directly linked the plan’s quantitative objectives and targets.

The investment requirement for outstanding Priority B settlements should show evidence of technical and physical planning feasibility.

The problem of existing Priority A and B Sewage Treatment Plant not operating in compliance with legislative requirements should be acknowledged and reasons assessed. If personnel competence and technical know-how problems are identified, these could be addressed through appropriate Structural Fund measures (e.g. training).



9.1.4 Municipal Solid Waste

Priorities within the field (i.e. type of investment) need to be established in the light of their contribution to legislative requirements. This also needs to be reflected in the regional breakdown, as the current situation, type of investment and target requirement vary between regions.

Quantitative objectives and targets need to reflect the updated Regional Plans on Solid Waste Management.

The type of investment that is in particular needed to achieve the 2013 target on organic/biodegradable waste needs to be explicit in the programming documents. To this end, a strategy at national level is necessary, backed by evidence as to the economically most viable measures. The prospects for covering part of the investment requirement through Public Private Partnership and other market schemes should be an explicit part of this strategy.

Concrete proposals at regional level on investment requirement for recovery/treatment plants (with respect notably to organic waste) need to be in line with the overall national strategy and to be backed by technical studies as to the technical feasibility and economic viability of the investment.

To determine the most suitable technologies and economically viable solutions for organic waste recovery, updated and accurate studies on the composition of municipal solid waste (national and/or regional), and of biodegradable waste in particular, are required. This, in turn, will determine financial investment requirements.

A political commitment is required as to the timing for developing the necessary legislation that will define the institutional framework for the operation of the Solid Waste Management Agencies (currently FOSDA) and for the pricing policy to be implemented.

Policy objectives with respect to the Polluter Pays Principle and full cost recovery should be explicit in the strategy.

9.1.5 Renewable Energy

Quantitative targets should be provided that are expressly linked to the 2010 targets and to the likely estimates on achievement of targets as updated in the National Situation Report on RES Penetration Levels (produced by the Ministry of Development, latest update October 2005).

The completion of the Spatial Plan on Renewable Energy Sources currently in progress (Ministry of Environment, Physical Planning and Public Works) is an essential prerequisite to determine investment potential, needs and priorities per region, as well as in order to ensure efficiency with respect to location issues.

Recently issues legislation is expected to simplify administrative procedures and boost private investors’ interest.

9.1.6 Natural Risk Management

Given that civil protection and risk management will figure as one of the priority axes in the environmental sectoral programme, and possibly in regional programmes, the overall comprehensive policy in this sector needs to be explicitly elaborated.

Interregional (cross-border) cooperation for the flood prevention and management with respect cross-border rivers should be an explicit and high priority.



9.2 Summary of Needs and Priorities [TO INSERT FINAL SUMMARY TABLES]



10 REFERENCE LIST

10.1 Across Fields Cohesion Fund Third Monitoring Committee Report for the 2000-2006 Programming Period, Ministry of Economy and Finance, 12 July 2005

Country Profile Report to the Twelfth Session of the Commission on Sustainable Development of the United Nations (UN CSD 12), Ministry YPEHODE, March 2004

Document for the Second National Conference on the National Strategic Development Plan 2007-2013 - Environment and Sustainable Development Priority Axis: Synopsis, Objectives, Vision, Ministry YPEHODE, December 2005

Directions for the National Strategic Development Plan with respect to the Environment Sector for the period 2007-2013, Ministry YPEHODE, February 2005

Environmental Signals - A Report on Sustainability Indicators, National Centre for the Environment and Sustainable Development (NCESD or EKPAA), 2003

EUROSTAT, statistical information and indicators as referenced in this report

EUROSTAT, Waste Generated and Treated in Europe, Data 1995-2003

Ex-Ante Evaluation of the Operational Programme for Competitiveness 2000-2006 and of the Programme Supplement

Interim Evaluation of the Operational Programme for Competitiveness 2000-2006, BCS and REMACO, 31 October 2003

Interim Evaluation of the Operational Programme for the Environment 2000-2006, BCS and KANTOR

Integrated Information System “Ergorama”, Ministry of Economy and Finance

Information Report 2005 on Structural Interventions in Greece: Policies, Results, Perspectives, Ministry of Economy and Finance

Ministry of Environment, Physical Planning and Public Works (YPEHODE), website and related information

Ministry of National Development (YPAN), website and related information

Minutes of Second National Development Conference on National Development Strategy, 9 December 2005

Minutes of Sustainable Development Thematic Seminar on 2007-2013 Programming, July 2005

National Environmental Information Network, website

National Reform Programme for Growth and Jobs, 2005-2008, Ministry of Economy and Finance, October 2005

National Statistical Service of Greece (NSS), statistical information and indicators as referenced in this report

Report on Development and Perspectives of the Greek Economy, Ministry of Economy and Finance, October 2005

Report on Environmental Actions and Projects of the Community Support Framework, Community Initiatives and Cohesion Fund for the Programming Period 2000-2006, Deloitte, October 2005



Structural Funds and Cohesion Fund Financial Plans 2000-2006 per Environmental Field of Intervention, European Commission, DG REGIO, REGIO-DW, December 2005

The 2005 update on the Hellenic Stability and Growth Programme 2005-2008, Ministry of Economy and Finance, December 2005

Third Guideline Document for the Elaboration of Operational Programmes for the 2007-2013 Programming Period, Ministry of Economy and Finance, June 2006

10.2 Water Supply Association of Municipal Water and Sewerage Companies (EDEYA), 17th Regular General Congress, 26-28 May 2005

European Environment Agency, “Europe’s Water: An Indicator Based Assessment”, November 2003.

EYATH SA (Thessaloniki Municipal Water Supply and Sewerage Company), website and related sources

EYDAP SA (Athens Municipal Water Supply and Sewerage Company), website and related sources

National Centre for the Environment and Sustainable Development, Research Paper No 16, “A Draft Format for a Water Reporting System”, March 2002

National Database for Hydrological and Meteorological Information (YPEHODE)


Association of Municipal Water and Sewerage Companies (EDEYA), 17the Regual General Congress Report, May 2005

Association of Municipal Water and Sewerage Companies (EDEYA), Third Report on Waste Water Treatment 91/271 and 98/15, 2004

Ministry of Economy and Finance, Technical Support Unit (MOD), Briefing Note on Sewage Treatment Plant and Sewerage Network Situation for Priority A, B and C Agglomerations, March 2006, provided by the Environment Secretariat of the Ministry YPEHODE

Ministry of Economy and Finance, Technical Support Unit (MOD), Briefing Note on Size of Priority A, B and C Agglomerations, 11 April 2006

Ministry for the Environment, Physical Planning and Public Works (YPEHODE), Working Group for the Promotion of Waste Water Treatment Projects (Ministerial Decision 175536/29-7-2004), Final Report, 29 July 2005

Situation Report 2002 on the Implementation of Directive 91/271/EC in Greece, issued in 2003

Study on Municipal Waste Water Treatment, EDEYA, September 2004

10.3 Municipal Solid Waste Joint Ministerial Decision 50910/2727 of 22-12-2003 on Measures and Conditions of Solid Waste Management, Government Gazette 1009 B/22.12.2003

Law 29407/3508/2002 on Sanitary Landfills, including the National Plan for Solid Waste Management



Ministry of the Environment, Physical Planning and Public Works (YPEHODE) – Solid Waste Management Unit, Briefing Note 31/03/2006 on EU A-2003/2187 and C502/03 on Waste Management

Ministry of the Environment, Physical Planning and Public Works (YPEHODE) – Solid Waste Management Unit, Internal Note on 2005 Recycling Data

Ministry of the Environment, Physical Planning and Public Works (YPEHODE) – Solid Waste Management Unit, Memorandum 19 of 14/12/2005 on Final Studies for the Remediation of Uncontrolled Disposal Sites (HADA), Protocol Number 135977/5051

Ministry of the Environment, Physical Planning and Public Works (YPEHODE) – Solid Waste Management Unit, Memoranda of 5 and 13/05/2004 on Legislation Implementation with Respect to Non Hazardous Waste Management, Protocol Number 103731/1278

Ministry of the Environment, Physical Planning and Public Works (YPEHODE) – General Secretariat on Environment, Briefing Note on Programme for the Remediation of Uncontrolled Disposal Sites, March 2006

Ministry of the Environment, Physical Planning and Public Works (YPEHODE), YPEHODE Working Group on Promotion of Projects on the Remediation of Uncontrolled Disposal Sites Sites, Summary of Final Report, April 2005

Regional Plans for Solid Waste Management 2005 and related Technical Studies and Decisions, Regions of Attica, Central Macedonia, Continental Greece, Crete, Eastern Macedonia and Thrace, Epirus, Ionian Islands, North Aegean, Peloponnese, Thessaly, Western Greece, Western Macedonia

Study on Best Practices and Available Pollution Prevention and Reduction Technologies in the Waste Management Sector as per Par.5, Annex I, EU Directive 96/61/1996, BCS, HASKONING BV, Stamelos, Architektonidis, on behalf of YPEHODE

Study on “Packaging Material in Greece, MIC on behalf of the Ministry YPEHODE, 2002

Study on “Recycling of Packaging Material”, MIC-ANION, 2001

10.4 Renewable Energy Biomass Cogeneration Network (BICOGEN), website and related information

Centre for Renewable Energy Sources (CRES), website and related information

Energy Technology Indicators, Cordis, European Commission

European Solar Thermal Industry Federation (ESTIF), “Sun in Action – A Solar Thermal Strategy for Europe, Volume II, Country Report on Greece”, April 2003

Greek Association of Renewable Energy Source Electricity Producers, website and related sources

Greek Solar Industry Association (EBHE), website and related sources

Hellenic Association of Photovoltaic Producers (HELAPCO), website and related information

Ministry of Development, National Information System on Energy

Ministry of Development, Second National Report Regarding the Penetration Level of Renewable Energy Sources, 2003

Ministry of Development, Third National Report Regarding the Penetration Level of Renewable Energy Sources Up To The Year 2010, October 2005



Ministry of Development, Note on the Institutional Framework for Renewable Energy Sources, Managing Authority of the Operational Programme for Competitiveness, 24 May 2005

Public Power Corporation (PPC), website and related sources

Regulatory Authority for Energy (RAE), website and related publications

Study on “Collection of Statistical Data on Solar Energy Applications in Greece”, CRES, 2001.

Study on “Methods of Financing Renewable Energy Investments in Greece”, CRES, September 2003

Study on “The Photovoltaics Market in Greece”, HELAPCO, 2005.

Third National Congress on Renewable Energy Sources, Presentation on the “Financing of RES through the OP Competitiveness”, Ministry of Development, Managing Authority of the Operational Programme on Competitiveness, 13 March 2006

10.5 Natural Risk Prevention European Forest Fire Information System (EFFIS)

General Secretariat for Civil Protection, website and related infromation

Hellenic Fire Service, website and related information

Law 2612/98

Law 998/79

Law 157/9 and related Presidential Decree 575 of 1980

10.6 Interviews Association of Municipal Water and Sewerage Enterprises (EDEYA): Ms Vardakou

European Commission, DG Regio: Mr P. Thanou

European Commission, DG Environment: Mr S. Ampatzis

Environmental Inspectorate: Mr Sarigiannidis (telephone interview)

General Secretariat for Civil Protection: Mr Kobouris (telephone interview)

Managing Authority for the Operational Programme on Environment (EPPER): Mr H. Alexopoulos, Mr A. Katsounis, Mr D. Papasotiriou, Mr V. Stoilopoulos

Managing Authority for the Operational Programme on Competitiveness: Ms E. Kritikou

Ministry of Development, Energy Service: Mr N. Spyropoulos

Ministry of Environment, Physical Planning and Public Works (YPEHODE) - General Secretariat on Environment: Ms A. Pahou (telephone interview, provided written briefing note)

Ministry of Environment, Physical Planning and Public Works (YPEHODE) - Water Service: Ms Lazarou (Head of Unit), Ms A. Dimopoulou and Ms L. Mitsi (Technical Support Unit- MOD - of the Ministry of Economy and Finance)

Ministry of Environment, Physical Planning and Public Works (YPEHODE) - Solid Waste Management Unit: Mr Y. Mahairas (Head of Unit), Ms E. Vassilaki



ANNEX A

1 2006 STRUCTURAL AND COHESION FUND INVESTMENT IN THE STUDY FIELDS Annex A includes extracts from the Country Profile Report on Greece that was prepared in January 2006 and presented to the European Commission on 1st February 2006 within the framework of this study. The extracts provide details on the Structural and Cohesion Fund investment in the study fields for the period 2000-2006, both planned investment and actual expenditure as at December 2005. Additional national financial instruments are described where pertinent (i.e. with respect to the renewable energy sector). Data processed and presented in this Annex provide the basis for estimates and assumptions on investment needs in the field-specific chapters of this report.

1.1 Environmental Investment – EU Structural Assistance All thirteen (13) Greek regions are Objective 1 under the current (and past) programming period, and benefit from Structural and Cohesion Fund assistance for all sectors of economic development. Structural Fund assistance comes through 13 Regional Operational Programmes (ROPs), one for each region, through 11 sectoral/thematic Operational Programmes (OPs), covering all regions, and through the Community Initiatives (CIs).

Total planned public investment in Greece for the 2000-2006 programming period for projects that receive Structural Fund assistance amounts to 34,076.4 million Euro, of which 22,707 million Euro comes from the Structural Funds (66.6%) and 11,369.4 million Euro (33.4%) is the national contribution. Private investment in these projects (for assistance to private business and SMEs) is planned at 10,730.5 million Euro. (Sources: DG REGIO – DW, Ministry of Economy and Finance Information Report 2005 on Structural Interventions in Greece). The breakdown of the planned budget between the fields of interest to this study is presented in the Overview Chapter of this report.

In addition to Structural Fund interventions, a total of 114 projects in the environment and transport sector receive financial assistance through the Cohesion Fund (22 of these projects are a “follow-up” of projects from previous programming period. The total planned investment in these projects is 5,934.3 million Euro of which 3,702.3 million Euro represent Cohesion Fund co-financing and 1,783.6 mill. Euro national public funds. The environmental projects (87 in total) concern a planned investment of 2,231.3 million (Cohesion Fund 1,674.3 million, the rest is national public funds). Actual expenditure to July 2005 on environmental projects reached a total of 686.7 million Euro. (Source: Cohesion Fund Third Monitoring Committee Report for the 2000-2006 Programming Period, Ministry of Economy and Finance, 12/07/2005).

EU funding through the above mechanisms is the main financial source for the implementation of environmental policy and legislation in Greece.

For the fields of interest to this study, environmental infrastructure is funded through:

• All 13 Regional Operational Programmes;

• Three (3) main sectoral/thematic Operational Programmes: Environment, Rural Development and Restructuring, and Competitiveness;

• Cohesion Fund environmental projects (mainly in the fields of water supply, wastewater treatment; and municipal solid waste management)



• Community Initiatives (to a lesser extent): Urban and Interreg.

1.2 Water Supply

1.2.1 General MS Funding

National funding comes as national contribution to EU structural assistance, at 25% of total investment for both Structural and Cohesion Funds. Amounts are presented in sections below.

1.2.2 Cohesion Fund

Institutions taking part in the implementation of Cohesion Fund Environmental Projects:

• Cohesion Fund Managing Authority (CF MA): Ministry of Economy and Finance

• Paying Authority (PA): Ministry of Economy and Finance (single paying authority for all SF and CF projects)

• Intermediate Bodies (IBs): Managing Authorities of SF Regional Operational Programmes for the respective region concerned by the CF project. Managing Authority of the National OP Environment (Ministry of Environment, Physical Planning and Public Works) for projects concerning broader water resource management infrastructure.

• Implementing Bodies and Final Recipients: Municipalities and Municipal Water Supply and Sewerage Companies

The Cohesion Fund finances big projects, which in the case of water supply, sewerage and wastewater treatment infrastructure are often combined (categorised as “mixed projects”). This reflects both the fact that institutional responsibilities are identical in the three fields, as well as the fact that they tend to be large-scale investments targeting a very specific urban area through a comprehensive infrastructure investment plan.

From the data available through a sample of 55 environmental Cohesion Fund projects (Source: Ministry of Economy and Finance, Integrated Information System), the analysis shows the following:

• A total of 7 projects concern strictly water supply infrastructure with a total approved investment of 306.6 million Euro (of which 25% is MS financing as in all cases).

• A total of 9 projects are combined with sewerage network infrastructure; total approved investment 123.2 million Euro.

• A total of 6 projects are combined with sewerage and waste water treatment infrastructure; total approved investment 104.4 million Euro.

• The geographic areas benefiting from the above projects concern all but 2 of the 13 Greek Regions (note that this is a sample of 55 projects of a total of 85 environmental projects).

Structural Funds (European Regional Development Fund)

Institutions taking part in the implementation of Structural Fund Operational Programmes that include measures on drinking water supply:

• Programme Managing Authority (MA):

o The Region (Special Managing Service) for each respective Regional Operational Programme (ROP)



o The Ministry of the Environment, Physical Planning and Public Works for the National OP Environment

o The Ministry of Rural Development and Food for the National OP on Rural Development



As presented in the Overview Chapter of this report, the total planned investment in the drinking water supply sector through Structural Fund programmes amounts to:

• 394.4 million Euro, which represents 1.1% of total planned public investment through SF programmes. 276.5 million Euro come from ERDF and 117.8 million from national funds.

The table below refers to actual total investment, which has been aggregated on a project-by-project basis per Operational Programme (Regional OPs and sectoral/thematic) according to data accessed through the Integrated Information System (Ergorama) of the Ministry of Economy and Finance. It includes a total of 409 projects completed or in progress as at December 2005. It is noted that 339 of these projects represent a total investment of under 1 million Euro. Projects cover all aspects of water supply infrastructure and concern extension of capacity and/or upgrading works. Total investment amounts to 262.1 million Euro.

Table A.1: Structural Fund Projects in the Water Supply Sector – Actual Total Investment per Operational Programme as at December 2005 (in thousand Euro)

Programme Full cost (€ thousand)

No of projects (total)

No of projects (cost > 1 mill €)

ROP Continental Greece 43,891.1 95 9 ROP Peloponnese 28,375.7 44 7

ROP South Aegean 12,993.0 17 4

ROP Crete 4,110.0 2 2

ROP Central Macedonia 17,639.6 12 6

ROP Ionian Islands 3,275.4 7 1

ROP Thessaly 13,694.7 20 3

ROP Epirus 13,641.6 23 4

ROP Western Macedonia 24,427.8 28 6

ROP Eastern Macedonia - Thrace 13,656.0 17 5

ROP Western Greece 21,112.9 48 2

ROP North Aegean 4,669.0 5 1

ROP Attica 46,579.3 31 20

Subtotal ROP 248,048.1 349 70

OP Environment 2,482.7 7 0



OP Rural Development 11,562.6 53 0

Subtotal OP 14,045.3 60 0

Total 262,093.4 409 70

Input Data Source: Ministry of Economy and Finance, Integrated Information System “Ergorama”.

In addition, the OP on Competitiveness (Managing Authority: Ministry of National Development - YPAN) funds studies and actions relating to water resources management, notably for the sectors that fall under YPAN’s responsibilities (energy, industry, commerce, tourism). The following current projects have been identified:

• Development of an index/record of water users in the above sectors (data will therefore become available on a national scale); total investment 0.5 million Euro.

• Programme aimed to record and assess the hydro-geological characteristics of surface and ground water sources in Greece; total investment 10.2 million Euro.

• Support to the development of regional water resources management plans; total investment 6.4 million Euro.

1.2.3 Key Observations

Financial assistance in the 2000-2006 period addresses mainly the critical issue of water supply infrastructure capacity and efficiency, and significant improvements in this direction have been made as a result. EU structural assistance is the main source of public funding of water supply infrastructure.

1.3 Waste Water Treatment



1.3.2 Cohesion Fund




• Intermediate Bodies (IBs): Managing Authorities of SF Regional Operational Programmes for the respective region concerned by the CF project. Managing Authority of the National OP Environment (Ministry of Environment, Physical Planning and Public Works).


The Cohesion Fund finances big projects, which in the case of water supply, sewerage and wastewater treatment infrastructure are often combined (categorised as “mixed projects”). This reflects both the fact that institutional responsibilities are identical in the three fields, as



well as the fact that they tend to be large-scale investments targeting a very specific urban area through a comprehensive infrastructure investment plan.

From the data available through a sample of 55 environmental Cohesion Fund projects (Source: Ministry of Economy and Finance, Integrated Information System) the analysis shows the following:

• A total of 9 projects combine water supply and sewerage network infrastructure; total approved investment 123.2 million Euro.

• A total of 6 projects combine water supply, sewerage and waste water treatment infrastructure; total approved investment 104.4 million Euro.

• A total of 8 projects concern exclusively waste water treatment infrastructure; total approved investment 116.8 million Euro.

• A total of 7 projects concern exclusively sewerage infrastructure; total approved investment 103.4 million Euro.

• The geographic areas benefiting from the above projects concern all but 2 of the 13 Greek Regions (note that this is a sample of 55 projects of a total of 85 environmental projects).

1.3.3 Structural Funds (European Regional Development Fund)

Institutions taking part in the implementation of Structural Fund Operational Programmes that include measures on wastewater treatment:






As presented in the Overview Chapter of this report, the total planned investment in wastewater treatment through Structural Fund programmes amounts to:

353.1 million Euro, which represents 1.04% of total planned public investment through SF programmes. 264.9 million Euro come from ERDF and 88.2 million from national funds.

The table below refers to actual total investment, which has been aggregated on a project-by-project basis per Operational Programme according to data accessed through the National Integrated Information System (Ergorama) of the Minsitry of Economy and Finance. It includes a total of 279 projects completed or in progress as at December 2005, with a total investment of 537.4 million Euro. Projects cover all aspects of wastewater treatment infrastructure across all regions. Most projects concern the extension of sewerage systems in both urban and rural areas, the establishment and/or upgrading of sewage treatment plants (STP).



Table A.2: Structural Fund Projects in Wastewater Treatment Sector – Actual Total Investment per Operational Programme as at December 2005 (in thousand Euro)






ROP Crete 18,957.5 11 6

ROP Central Macedonia 21,581.9 11 6



ROP Epirus 10,430.3 9 5


ROP Eastern Macedonia - Thrace 55,168.5 29 17

ROP Western Greece 27,299.1 36 8


ROP Attica 98,585.1 53 41

Subtotal ROP 488,888.1 262 157 OP Environment 48,535.0 17 6

Total 537,423.1 279 163

Input Data Source: Ministry of Economy and Finance, Integrated Information System “Ergorama”.


Financial assistance in the 2000-2006 period addresses mainly the critical issues of STP compliance with the UWWT Directive, and of sewage systems extensions/construction and upgrading, including the creation of non-combined sewage systems (which is further essential for integrated flood prevention mainly in urban areas).

It appears that lesser investment has been directed in sludge treatment and disposal routes alternative to landfill. While investment requirements in the critical areas mentioned above will continue to be high in the future, support to investment in sludge treatment and alternative routing in agriculture, incineration, soil, etc could be of environmental as well as economic benefit.

1.4 Municipal Solid Waste





1.4.2 Cohesion Fund




• Intermediate Bodies (IBs): Managing Authorities of SF Regional Operational Programmes for the respective region concerned by the CF project. The Ministry of Environment, Physical Planning and Public Works.

• Implementing Bodies and Final Recipients: Municipalities (and the Ministry YPEHODE for projects concerning the Attica Region landfills) and the Solid Waste Management Agencies responsible for the operation of the landfills

The Cohesion Fund finances large-scale infrastructure projects, which in the case of solid waste management concern improvement of the overall solid waste management system of specific regions or large areas (departments) within regions, including investment in sanitary landfills.

From the data available through a sample of 55 environmental Cohesion Fund projects (Source: Ministry of Economy and Finance, Integrated Information System), the analysis shows a total of 15 projects on solid waste management across 11 Regions, with a total investment of 272.6 million Euro (Table A.3 below):

Table A.3: Cohesion Projects in Municipal Solid Waste Management Sector – Sample of 55 Projects as at December 2005 (in thousand Euro)


EU CF (€ thousand)

No of Projects

Brief Description

ROP Continental Greece 6,731.6 5,084.7 Sanitary landfill

ROP Peloponnese - -

ROP South Aegean 25,922.0 19,441.5 1 SWM works for Region

ROP Crete 62,793.3 47,095.0 2 Treatment, composting & sanitary landfill

ROP Central Macedonia 70,881.1 53,160.8 3 2 sanitary landfills, SWM works

ROP Ionian Islands 9,953.0 7,464.8 1 Sanitary landfill

ROP Thessaly 9,284.2 6,963.2 1 Sanitary landfill

ROP Epirus 12,155.7 9,116.8 1 SWM works for Region

ROP Western Macedonia 12,974.9 9,731.1 1 Regional Integrated WM System

ROP Eastern Macedonia-Thrace - - -

ROP Western Greece 12,830.0 9,622.5 1 SWM works for Region

ROP North Aegean 27,724.1 20,793.1 2 SWM works for 2 Depts

ROP Attica 21,300.0 15,975.0 1 Sanitary landfill

Total 272,549.9 204,412.5 15



Input Data Source: Ministry of Economy and Finance, Integrated Information System “Ergorama”

1.4.3 Structural Fund (European Regional Development Fund)

Institutions taking part in the implementation of Structural Fund Operational Programmes that include measures on municipal waste management:



o The Ministry of the Environment, Physical Planning and Public Works (YPEHODE) for the National OP Environment


• Implementing Bodies and Final Recipients: Municipalities (and the Ministry YPEHODE for projects concerning the Attica Region landfills) and the Solid Waste Management Agencies responsible for the operation of the landfills.

As presented in the Overview Chapter of this report, the total planned investment in the urban and industrial waste management sector – that is, including hospital and dangerous waste as opposed to strictly municipal solid waste which is the focus of this section – through Structural Fund programmes amounts to:

• 360.7 million Euro, which represents 1.06% of total planned public investment through SF programmes. 267.4 million Euro come from ERDF and 93.3 million from national funds.

The table below (A.4) refers to actual total investment exclusively in municipal solid waste management, which has been aggregated on a project-by-project basis per Operational Programme according to data accessed through the Integrated Information System (Ergorama) of the Ministry of Economy and Finance. It includes a total of 69 projects completed or in progress as at December 2005, with a total investment of 90.5 million Euro.

Projects through the Regional Operational Programmes (ROPs) mainly concern waste collection infrastructure and closure/reclamation of non-compliant landfills. Projects through the OP Environment concern planning, construction and upgrading of sanitary landfills, and closure and reclamation of non-compliant landfills. Note that the two regions (Central Macedonia and Western Greece) that do not appear to receive funding on municipal waste management through the Regional OPs, actually receive significant amounts through the Cohesion Fund, and also through the OP Environment. The Community Initiative (CI) of Perama funds one project for the development of an integrated solid waste management system in the enterprise zone (designated-use) of the Municipality.



Table A.4: Structural Fund Projects in Municipal Solid Waste Management Sector – Actual Total Investment per Operational Programme as at December 2005 (in thousand Euro)






ROP Crete 2,428.4 1 1

ROP Central Macedonia - - -



ROP Epirus 1,251.9 5 -


ROP Eastern Macedonia - Thrace 993.7 2 -

ROP Western Greece - - -


ROP Attica 34,444.1 2 2

Subtotal ROP 64,692.5 34 12 OP Environment 25,580.3 8 8

CI URBAN (Perama) 221,6 1 -

Total 90,494.4 69 20

Input Data Source: Ministry of Economy and Finance, Integrated Information System “Ergorama”


Structural and Cohesion Fund financial assistance in the 2000-2006 period addresses mainly the critical issues of sanitary landfills and closure/reclamation of non-compliant landfills across the country, resulting into significant progress in infrastructure improvements. EU funded programmes and projects are the main source of funding in this field.

1.5 Renewable Energy


The two main instruments for providing public financial assistance to RES investment projects are the EU Structural Funds through the Operational Programme on Competitiveness, and State subsidies provided through the National Development Law.

Under the EU Operational Programme on Competitiveness, public funding of total eligible RES investment cost is: 30% in the case of wind parks and conventional solar thermal units (not for households); 40% for small hydro, biomass, geothermal, high-tech solar thermal



units and passive solar; and 40-50% for PV. The minimum private investment cost required is 44,000 Euro. The National Development Law (2601 of 1998 and the new NDL 3299 issued in 2004), provides State subsidies to private investment in a wide range of business activities across all sectors of the economy and with a strong regional dimension favouring less developed regions.

All types of private investment in renewable energy production and renewable energy sources (RES) are eligible for assistance under the NDL, irrespective of region. Part of this assistance is actually co-financed through Structural Fund Operational Programmes for eligible measures, such as measures concerning RES. As at March 2006, investment in RES through the NDL amounted to a total of 85, 852,800 Euro, of which 32 million Euro accounted for public sector subsidy (50% of which was ERDF assistance).

Renewable energy business activities that are eligible for a subsidy (grant of 30-40% of total investment) under the NDL include: production of biofuels or solid fuels out of biomass, production of biomass for use in energy production, production of electricity from solar, wind energy, geothermal, biomass and hydro.

The above types of investment support does not concern the large-scale hydro-electrical installations which are part of the Public Power Corporation’s investment schemes (PPC currently operates as a private company following deregulation of the energy market).


Institutions taking part in the implementation of the Operational Programme on Competitiveness, which is the key programme financing activities in the renewable energy field, include:

• Programme Managing Authority (MA): The Ministry of National Development (YPAN)


• Implementing Bodies and Final Recipients: Private enterprises, SMEs, public and private institutions and research centres involved in the field of renewable energies.

According to DG REGIO data provided in early December 2005, the initial total planned investment for infrastructure and productive investment projects concerning energy savings and renewable energies in particular, through Structural Fund programmes amounted to:

• For environment friendly technologies, clean and economical energy technologies: 581.2 million Euro, of which 304.6 million Euro represent ERDF assistance. This represents 1.3% of total planned SF investment (including private funds).

• Specifically for the production and delivery of renewable energy sources infrastructure (solar, wind, hydro, biomass): 51 million Euro, of which 27.7% comes from the ERDF. This represents 0.1% of total planned SF investment (including private funds).

Following a revision of the OP Competitiveness in December 2005, additional funds were allocated to certain OP measures concerning RES. The following details are provided in an presentation note of the OP Managing Authority (Ministry of Development) dated 13 March 2006, indicating also actual expenditure (projects completed or in-progress or in tendering procedure) to that date:

• The planned budget of the OP Competitiveness action 2.1.3 which represents 70% of the total OP budget that is allocated to RES, was raised to 869.86 million Euro, of which 325 million Euro represented public investment (national and ERDF). Actual committed expenditure to March 2006 amounted to 578.69 million Euro for a total of



116 investment projects, with 192.16 million Euro public funding (60% of total available).

• The planned budget of action 6.5 currently stands at 381.04 million Euro, of which 225.3 million represent public funds (national and ERDF). Actual expenditure (projects approved or in tendering procedure) on projects directly concerning RES amounts to 361.6 million Euro.

• Two further actions, 6.3.2 and 2.1.4 have a total budget of 50.73 million Euro. A tender of 27 million (action 6.3.2) is in process.

On the basis of the above data, it follows that total planned investment in RES through Structural Fund assistance, is 1,301.6 million Euro, representing 2.9% of total (including private investment) planned investment through the SF programmes. Actual expenditure as at March 2006 amounted to 967.5 million Euro, that is 74% of the total planned budget.


From the above analysis, and given the rapidly increasing size of the renewable energies sector in Greece, it becomes evident that Structural Fund - ERDF support in the current programming period has been critical (if not pivotal) for the generation of private investment in the renewable energies sector in Greece. This is a sector with most significant growth potential, and further assistance (incentives) will be most beneficial in environmental as well as economic terms.

1.6 Natural Risk Management (Fire, Drought, Floods)



1.6.2 Cohesion Fund

Institutions taking part in the implementation of Cohesion Fund Environmental Projects: as per other sections of this Annex (with the exception noted below).

The Cohesion Fund finances large-scale environmental infrastructure projects. From the data available through a sample of 55 environmental Cohesion Fund projects, three (3) projects were identified in the fields of interest to this section of the report:

• Water Resources Management: cleaning and reinstating the flow of the torrent Xiras; total approved investment 39.3 million Euro.

• Equipment for Forest Fire Prevention: Managing Authority Ministry of Public Order - Fire Service; total approved investment 40 million Euro.

• Protection and Improvements of the forest in the Thessaloniki broader urban area; total approved investment 15.1 million Euro.


Institutions taking part in the implementation of Structural Fund Operational Programmes that include measures related to natural risk management:






o The Ministry of Rural Development and Food for the National OP on Rural Development


As presented in the Overview Chapter of this report, the total planned investment through Structural Fund programmes for actions concerning the natural risk management fields of interest to this study amounts to:

• 940.6 million Euro, which represents 2.76% of total planned public investment through SF programmes; 688.3 million Euro come from ERDF and 252.3 million from national funds.

The table below refers to actual total investment, which has been aggregated on a project-by-project basis per Operational Programme according to data accessed through the Integrated Information System of the Ministry of Economy. It includes a total of 709 projects completed or in progress as at December 2005. The projects were selected from fields of action that specifically target or directly relate to natural risk management.

They include projects focusing on irrigation and flood prevention infrastructure works in rural areas, and projects for forest areas. From the latter category, projects have been identified that specifically target fire and flood prevention (category forests: fire & WRM in table below).

Regional OPs include a variety of fire and flood prevention measures: in forests, including fire fighting equipment and related infrastructure; the cleaning up and reinstatement of torrents; irrigation and related ant-flooding infrastructure. The OP Environment includes mainly water resource management projects. The OP Rural Development includes projects on irrigation and flood prevention in agricultural areas. Community Initiative INTERREG IIIA programmes include investment in fire fighting equipment and related infrastructure.

Total investment amounts to 806.1 million Euro and is spread across all geographic regions.

Table A.5: Structural Fund Projects Targeting Natural Risk Management (Fire, Floods, Drought) – Actual Total Investment per Operational Programme as at December 2005 (in thousand Euro)

Irrigation and Flood Prevention

Forests

Programme Full cost (€ million)

P Forests: All Projects

P Forests: Fire & WRM

P

ROP Continental Greece 38.5 16.3 51 7.1 22

ROP Peloponnese 14.1 7.0 13 1.0 3

ROP South Aegean 4.0 3.1 9 2.4 7

ROP Crete 70.1 2.1 12 0.1 1

ROP Central Macedonia 30.8 19.2 44 7.1 23



ROP Ionian Islands 5.4 2.9 10 1.8 6

ROP Thessaly 69.2 13.5 19 4.0 6

ROP Epirus 31.9 13.8 38 5.7

ROP Western Macedonia 43.5 5.7 16 2.4

ROP Eastern Macedonia - Thrace 41.3 27.7 65 5.1

ROP Western Greece 30.8 10.2 39 5.6

ROP North Aegean - 1.3 4 1.2

ROP Attica 1.9 10.9 24 2.0

OP Environment 1.5 - -

OP Rural Development 288.3 0.7 3 0.3

Subtotal OP 289.8 0.7 3 0.3

CI INTERREG IIIA, GR-Cyprus - - - 7.6

CI INTERREG IIIA, GR-Albania - - - - 3.0

CI INTERREG IIIA, GR-Bulgaria - - - - 5.5

CI INTERREG IIIA, GR-FYROM - - - - 5.2

Subtotal CI - - - - 21,3

Total 671.5 362 134.6 347 67.1

Grand Total (€ million) 806.1 (709 projects in total)

Input Data Source: Hellenic Ministry of National Economy, Integrated Information System “Ergorama”

P = Number of Projects

Forests: Fire & WRM = It is a sub-category of Forests, including those projects specifically targeting fire and flood prevention, as opposed to general preservation and support to forest productive activity.

In addition to the above, one very important project is financed through the OP Information Society (total investment 4.5 million Euro), for the development of an Integrated Information System on Civil Protection from Natural Risks and Hazards.




Financial assistance in the 2000-2006 period has effectively addressed issues relating to fire and flood prevention. For the next programming period, the key priority will be the development of tools for integrated risk management. Needs identified include: mapping and risk assessment; development of a national system of timely warning, development of an integrated administrative system for risk management.



ANNEX B

2 INSTITUTIONAL CONTEXT AND RELATED ISSUES Annex B presents extracts from the Country Profile Report on Greece that was prepared in January 2006 and presented to the European Commission on 1st February 2006 within the framework of this study. The extracts provide details on the institutional and administrative context and related issues with respect to the study fields.

2.1 Water Supply Further to the introduction of the Water Framework Directive into national legislation in 2003 (L.3199/2003), the National Water Committee (consisting of the Ministers of Environment, National Economy, Interior, Development, Health and Agriculture, all of whom have competences in water resources management in their area of jurisdiction) was established as the strategic body responsible for water resources management policy at national level. However, the decisions on the establishment of the implementing bodies foreseen in the legislative framework were issued very recently in December 2005 (i.e. for the establishment of the National Water Council, the Central Water Agency/Service of the Ministry YPEHODE, and of the Regional Water Directorates for each of the 14 River Basin Districts). There has therefore been considerable delay in the implementation of the national legislation integrating the Water Framework Directive (WFD), with respect to establishing the required institutional mechanisms.

The Regional Water Directorates – one for each River Basin District – to be established under this scheme will be supervised by the National Water Council and coordinated by the Central Water Agency at YPEHODE (currently being established). The RWDs are responsible for the development of specific Water Management Plans that will include specific measures for each identified river basin with their District’s jurisdiction. Legal coordinating mechanismss for the management of river basins that cross RBD borders are foreseen in the legislation. The River Basin Management Plans are due to be completed in December 2008.

Drinking water supply infrastructure and services in Greece fall exclusively under the responsibility of the public sector. Water supply is the responsibility of local government (municipal and community level) with the exception of the broader Athens and Thessaloniki agglomerations (see following paragraph).

Implementation is the responsibility of municipal enterprises (Municipal Companies for Water Supply and Sewerage – DEYA) owned by local government (that is, owned by Municipalities in the case of broader urban areas or Associations of Communities for rural areas). The only exceptions are the Athens Water Supply and Sewerage Company (EYDAP SA), which is responsible for the broader Athens agglomeration in Attica, and the equivalent company in Thessaloniki (EYATH SA), which come under the direct jurisdiction of the Ministry (YPEHODE). There are 214 DEYA in total, covering more than 10.000 municipalities and/or communities across Greece.

At central level, YPEHODE has overall legislative and regulatory responsibility for water resources management. Licences required for all categories of water use (including licences required by DEYA for drinking water supply) and for works concerning water resource exploitation are issued at regional government level in line with the relevant central government regulation. The relevant regulation on licensing is recent (Joint Ministerial Decision 43504/5-12-2005), following the introduction into national legislation in 2003 of the WFD.



With respect to water quality issues, YPEHODE is responsible for monitoring the quality of water resources through the national network of relevant units and laboratories operating under its responsibility (includes the upgraded laboratories of the General State Chemical Laboratory and of certain Municipalities). For drinking water quality the responsibility rests with the operators, i.e. the municipal water supply and sewerage companies - DEYA, which maintain specialist laboratories. It is further monitored by the Ministry of Health and its regional laboratories.

With respect to water supply for other uses, central government level responsibilities include the Ministry of Rural Development and Food for agricultural use/irrigation works, and the Ministry of National Development for use in the energy, industrial, tourism and commercial sectors.

Private sector is not involved in drinking water supply. Industries and households may receive licences for groundwater drilling for own use (strictly excluding drinking).

2.1.1 Waste Water Treatment

The institutional framework and structure of wastewater treatment infrastructure and services is similar to that of the water supply sector - that is, responsibilities are primarily at local government (municipal) level.

Specifically, the municipal enterprises responsible for water provision (DEYA) are also responsible for the sewerage systems and the operation of treatment plants (STP). The same is the case of EYDAP SA and EYATH SA which come under the direct jurisdiction of the Ministry of Environment, Physical Planning and Public Works (YPEHODE).

At central government level, YPEHODE has overall policy, regulatory, monitoring and control responsibilities.

There is no private sector involvement in wastewater treatment. In the future, it is realistic to anticipate private sector investment interest in final sludge disposal, notably for agricultural use and incineration. This could be also applicable for sludge treatment in connection with revenue generating final disposal. Recently passed (September 2005) legislation on Public Private Partnerships provides the framework to enhance such prospects.

2.1.2 Municipal Solid Waste

Overall policy responsibility rests with the Ministry of Environment, Physical Planning and Public Works (YPEHODE). The Ministry leads the development of the 5-year National Plan that sets the principles and the targets for solid waste management policy. The National Plan is drafted in collaboration with the other central government departments concerned – the Ministries of Health, Interior, Rural Development and Food – as well as with the associations of local government representatives.

The National Plan requires the submission of Regional Plans harmonised to its content, which are drafted by the Environment Directorates of the Regions through consultation with other regional and local authorities.

The Ministry YPEHODE is further responsible for the evaluation of the effectiveness of the National Plan and may instigate its revision if required.

The operational aspects of municipal solid waste collection and disposal (including the operation of landfills) are the responsibility of regional and local authorities. The collection of municipal waste from the generation points and its transfer to either intermediate transfer stations or landiflls is the direct responsibility of Municipality services (Local Authority Organisation – OTA). The collection of waste from intermediate transfer stations to the landfills as well as the operation of the transfer stations and of the landfill facilities is the responsibility of the Solid Waste Management Agencies (FOSDA). FOSDA are established



as per Law 1650 of 1986 and operate under the auspices of the respective regional /local managing authority.

According to the competent YPEHODE services, new legislation to be developed in the course of 2007 will aim to reform and simplify the institutional context of FOSDA operation, and provide explicit requirements for the mode of operation, organisation as well as for billing their services.

There are very few cases where private companies are sub-contracted by Municipalities to operate solid waste collection and disposal. In the majority of cases the Municipalities maintain own equipment and personnel. Other than this, private sector investment is directed exclusively to the recycling sector.

2.1.3 Renewable Energy

Policies on renewable energy are an integral part of the broader national policy on energy under the responsibility of the Ministry of Development (YPAN). It is noted that Greece is currently in a process of liberalisation of the electricity (including natural gas) market. This, along with the completion of the natural gas infrastructure are the top policy priorities.

Within this broader framework, support for the development of renewable energy sources (RES) has been an increasingly prominent axis of the energy policy over the past ten years. RES have received significant financial support both through the 2nd and the 3rd Community Support Frameworks: during the 2nd CSF through the Operational Programme for Energy, and currently through the Operational Programme on Competitiveness.

In addition to the specific OP on Competitiveness, the other financial instrument for RES support is the National Development Law (2601 of 1998 and the new NDL 3299 issued in 2004), which provides State subsidies to private investment in a wide range of business activities across all sectors of the economy and with a strong regional dimension favouring less developed regions. With the exception of the large-scale hydro-electrical installations of the Public Power Corporation, all RES are eligible for assistance under the NDL irrespective of region.

A new legislative framework for renewable energies (RES and Cogeneration) drafted under the responsibility of YPAN is currently (January 2006) in consultation procedure. (This legislation was actually passed through Parliament in June 2006, at the time of completing this report). This legislative framework, in combination with the recently issued legislation on Public Private Partnerships (Law 3389 of 22-9-2005), is intended to stimulate private investment in the RES fields and increase renewable energy share level towards meeting the 2010 target (20.1% of electricity consumption, and 29% to the year 2020).

A key aspect of the new legislation will be the simplification of administrative procedures for the issuing of licenses/permits, which is currently considered a key obstacle to further development in this field. Also under consideration are improvements in the renewable energies pricing and tariffs policies (details provided in Annex E of this report).

2.1.4 Natural Risk Management (Fire, Drought, Floods)

The General Secretariat for Civil Protection (GSCP), under the jurisdiction of the Ministry of Interior and Public Administration, has overall coordinating responsibility for the development of natural hazard protection plans – this mainly concerns the development of an emergency response plan at national level as opposed to risk assessment and planning. The GSCP is also responsible for liaising with other EU and international organisation on civil protection. It is noted that Civil Protection Offices are currently in the process of being established in all central government departments (Ministries) and regional and local authorities, in an effort to improve coordination in risk management and response planning at national level.



Management responsibilities are divided between different bodies and levels of government per type of natural risk.

Institutionally, fire-related risk management policy, planning and implementation falls under the responsibility of the Fire Service which is under the jurisdiction of the Ministry of Public Order. The Fire Service is the key regulatory and control agency. In case of incident it leads and coordinates all other central, regional and local agencies and government services involved.

Floods and drought incidents are addressed by the regional/local authorities, which are responsible to coordinate at local level the various agencies involved/concerned. Depending on the type and extent of the incident, and type of infrastructure or investment damage incurred, central government departments are involved, such as the Ministry of Interior Affairs and the Ministry of Agriculture. In the notable most recent case of flooding (March 2006) of the cross-border Evros river, the Ministry of External Affairs undertook the coordinating role with the respective Bulgarian authorities.

The institutional framework for flooding incidents is likely to change once the water management structures (as per Water Framework Directive requirements) are in place and the river basin management plans are developed (anticipated to be comleted in 2008). As per legislative requirements, the Ministry of Environment, Physical Planning and Public Works (YPEHODE) presides the National Water Committee (see section on water above).



ANNEX C

3 FIELD INDICATORS – Summary DATA TABLES

3.1 Water Supply Summary Data Table Data on drinking water supply are not systematically collected and processed at national/central level, but at the level of the individual municipal water supply and sewerage companies. Quantitative data of relevance to the indicators proposed within the framework of this study, as and where identified, are provided in the table.

Data on water resources are expected to be systematically collected in the preparation of Regional (River Basin) Water Management Plans and introduced into the National Database on Hydrological and Meteorological Information, as per recent legislative requirements. The non-availability of cumulative data at national level has been confirmed by the National Statistical Service and the competent service on water management of the Ministry YPEHODE.

Where appropriate, indicators provided below concern the Athens Water Supply and Swerage Company (EYDAP S.A.) and the equivalent company for Thessaloniki (EYATH S.A.) which between them cover 53% of total country population. However, it is noted that these indicators are not typical of the situation at national scale as they concern large urban agglomerations and given that there are significant differences in quality of infrastructure and investment needs amongst the 214 Municipal Water Supply and Sewerage Companies (DEYA) that exist across Greece.

Type of Investment

Physical Indicators (Proposed)

Physical Indicators (Identified)

Connection rate to drinking water supply (%) 1998: 92% of country population (UN CSD)

2005: 99% of country population (est. YPEHODE)

Attica Basin: 1,831,520 metered connections servicing a population of 4,000,000 (EYDAP 2005)

Unit water supply (lts /inh/day)

830 m3 per capita consumption (UN CSD, 2004)

Total drinking water demand households (million m³)

Demand/consumption:

935 mill. m3 / day (estimate 2004)

Thessaloniki: 200,000–230,000 m3 (EYATH 2005)

Attica Basin (all uses): 1.1 mill. m3 (EYDAP, 2003)

Total drinking water demand industry (million m³)

Demand/consumption:

17 mill. m3 / day (estimate 2004)

Thessaloniki: 32.000 m3 / day (EYATH, 2005)

Water supply (general issues)

Water price (EURO/lt) EYDAP average water and sewerage price 0.67 euro per m3 (2003)



Volume in reservoirs (million m³)

Indicative:

- Multipurpose reservoirs at 17 PPC operated plants servicing drinking water supply for 20% of population and irrigation water supply: 6.5 billion m3 at end of wet period (UN CSD, 2004)

Attica Basin (EYDAP 2006):

- 4 raw water reservoirs (3 natural 1 artificial) with total operational volume 1.4 billion m3, plus 105 boreholes with pumping capacity 0.8 million m3/day (used as back up).

- 4 water treatment plants with a combined capacity of 1.9 million m3/day

- 56 drinking water storage reservoirs (tanks) of 0.9 million m3 volume

- The above cover a total water supply/demand of 1 million m3/day

Reservoirs (eg to store surface waters and/or groundwater)

Associated period of water reserve (days)

N/A

Drinking water production capacity -by source (million m³/year) (groundwater, surface water, other)

For the Attica Basin (EYDAP 2006):

- Surface water: 693,500,000 m3 /year

- Groundwater: 292,000,000 m3 / year

- Actual annual water production (2003): 399,220,304 m3/year

Drinking water ‘production’ plant - ground/surface (quality)

% of samples meeting standards

N/A (see field-specific chapter)

Area / pop of the country self-sufficient in drinking water (%)

Shows dependency of the area on water transport

Concerns mainly North and South Aegean islands (see section 2.1) corresponding to 4.5% of total country population

Connection rate to drinking water supply (% population or households connected to systems)

See indicator provided above

Geographical variation (min % - max %)

N/A

Water transport -

Distribution of water (includes house connections)

Continuity of supply (hours/day)

Continuous (24 hours / day). Exception certain islands where during the dry/tourist season and in case of shortage, drinking water supply stops for 1-2 hours daily.



Water loss minimisation

Water losses (% of volume and million m³)

45% water losses - estimated average for all uses

Drinking water supply: 30% (estimate)

Irrigation supply: 47% (estimate)

Significant regional/local variations are noted.

(EYATH 2006, confirmed by YPEHODE services)

Monitoring Drinking water sampling points – meeting drinking water quality standards (%)

N/A (see field-specific chapter)

Households with metering public water supply (%)

98% Metering (eg households)

Households with metering own (ground)water supply (%)

N/A

Sources: National Centre for the Environment and Sustainable Development (Environmental Signals Report); UN CSD 12 (Country Profile Report); EYDAP S.A.; EYATH S.A.

Waste Water Treatment Summary Data Table

Indicators are included in the Table below as and where readily available. As in the case of water supply, data on the two larger municipal water supply and sewerage companies, EYDAP S.A. (covering the broader Athens urban area, i.e. the Attica basin) and EYATH S.A. (Thessaloniki agglomeration) are provided as an indication.

Type of Investment

Physical Indicators (Proposed)


Sewage connection rates (% of population or households connected);

Broader Athens Agglomeration under EYDAP responsibility (2005):

5,800 km sewer network, 92% of total requirement, services 3,300,000 inhabitants

Priority A and B settlements: 90% of total requirement (includes infrastructure projects in process of implementation) (MOD, 2006)

Priority C settlements: 27% of population (MOD, 2006)

Sewage networks and connections (eg households, small industry)

Km of sewer networks (If available)

N/A

Broader Thessaloniki Agglomeration under EYATH responsibility (2005): 1,600 km

Trunk sewers / collectors

Km of trunk sewers/collectors EYDAP: 1 main trunk collector, 51.5 km

Treatment plant % of country surface area classified as sensitive area for the UWWTD4

Priority A and B settlements: total census population 6.4 million (MOD, 2006)

4 Urban Waste Water Treatment Directive 91/271/EC



Share of population or households connected to STPs

Number of agglomerations that have been defined for the implementation of the UWWTD

Number of STP in place that comply with the UWWTD standards (y)

Number of STP in place that are not fully compliant (z)

Total biodegradable capacity of the above (y + z) plants in PE5

hydraulic design capacity of the newest plants expressed in l/PE/d

Quantity of sludge produced [tons DS/year]; (If available) 105,000 tons (EYDAP, 2005)

80,000 tons (EUROSTAT)

Type of sludge treatment used (dewatering, digestion; drying; other);

Dewatering, digestion, natural drying, concentration (EYDAP)

Sludge management (waste)

Disposal or reuse route used (agriculture; soil; landfill; incineration; other)

Landfill 98.5% (EDEYA, 2005)

Agriculture 1.5% (EDEYA, 2005)

Design criteria for Combined Sewer Overflows (CSO) (If available)

n° of compliant CSOs (If available)

Storm drains and reservoirs

n° of non-compliant CSOs (If available)

N/A

Sources: Ministry of Economy and Finance (Information Report 2005 on Structural Fund Interventions in Greece); Ministry of Economy and Finance Technical Support Unit (MOD, Note 11/04/2006); Association of Municipal Water Supply and Sewerage Companies (EDEYA, various publications listed in References chapter); EYDAP S.A;. EYATH S.A.

Indicative Data on Investment and Operating Costs:

EYATH’s investment plan for 2005-2006 is for a total investment of 78.6 million Euro. As per the plan, investment in sewerage is 39.3 million Euro (50% of total), of which:

• Piping, 27 million Euro (68.7%);

• Pumping stations, 2.2 million Euro (5.6%);

• STP maintenance, 1.1 million Euro (2.8%);

• Studies and equipment, 9 million Euro (22.9%).

5 1 PE = 60 gBOD/day



The above is indicative of the priority given to network/system extension and upgrading works

Municipal Solid Waste Summary Data Table

Type of Investment Physical Indicators (Proposed)


Municipal Waste (general issues)

Total waste generated (mt/year and kg/year per capita)

4.7 mt/year (2003)

100,000 to 150,000 annual increase over 1997-2001)

1.14 kg/day/per capita (National Plan) – or 416 kg/year/per capita

428 kg/day/per capita (Eurostat, 2003)

Attica Region generation: 39% of total, 1.29 kg/day/per capita

Coverage of waste collection system - % of population covered in urban/rural areas

85-90% per weight of the generated waste (2005)

The remaining (10-15%) corresponds to low-populated rural and mountainous areas

Composition of municipal waste (%) (incl. % share of packaging)

20% share of packaging

47% fermentable

20% paper

8.5% plastic

4.5% metals

4.5% glass

other 15.5%

Waste collection equipment (e.g. transport vehicles)

Amount of selectively collected waste per household (tonnes per waste stream)

N/A

Recycling points for non-hazardous municipal waste

Availability of on street facilities and more major collection points (rural/urban areas)

Separate collection and recycling/recovery is 8.8% of total municipal waste generated (2005)

Waste collection

Import/export of waste collected

Amount (mt) of compliant import/export of municipal waste (e.g. for recycling)

401,192 t/year

Waste recycling

Recycling plant

Amount (mt) and share of municipal waste recycled (detail if available e.g. packaging)

8.8% of total municipal solid waste recycled (2005) – represents 10.4% of household wast

21% of recyclable waste recycled (65% paper, 3% plastic, 10% metal, 19% glass)

45% of packaging material recycled (2005)



Amount (mt) of biodegradable municipal waste produced

2.142,730 t (2001) Composting

Amount (mt) and share of biodegradable municipal waste composted

32,000 t / year (Eurostat, 2002) or 1.5% of total biodegradable

0 (Eurostat, 2003)

Number of incineration facilities

Capacity (tonnes/year and GJ/year) and activity/availability of incinerators

Equipment of plants to achieve emission ceilings (incl. dioxins and furans)

Incineration plant (for MSW)

Amount of municipal waste incinerated with energy recovery

0

(incineration applied only to hospital hazardous waste)

Number of sanitary landfills

45 constructed (2005)

56 in progress (2005)

Number of non compliant landfills

% of recyclable/reusable waste that is landfilled

Number of (illegal) waste dumps in use/not in use

1,125 illegal waste disposal sites in use (2005)

Closed waste dumps (to be) recultivated

2,626 illegal waste disposal sites to be closed and reclaimed (2004)

Waste (Final) disposal

Landfill sites (Municipal) – general and hazardous

Municipal waste landfilled (mt/year)

90.5% of total municipal waste generated is landfiiled

Sources: Joint Ministerial Decision 50910/2727/ of 2003 on Measures and Conditions of Solid Waste Management, including National Plan; National Environmental Information Network; EUROSTAT; United Nations CSD 12 Report; Ministry YPEHODE Summary Final Report on HADA April 2005; Ministry YPEHODE Brefing Note March 2006

Renewable Energies Summary Data Table

Type of Investment Physical Indicators (Proposed) Physical Indicators (Identified)

Share in total energy needs (2005):

Large Hydro 6.3%

Other RES (Wind, Small Hydro, Biomass, PV combined) 3.1%

Wind Capacity of wind turbines (MW) and % over total energy production

550 MW (Eurostat 2003)

621.70 MW (Situation Report 2005)



Output of wind turbines (MWh) and % over total energy production

0.9% of total energy primary production (Eurostat 2003)

Areas and energy potential (E.g. wind speeds above 5m/s)

Potential & investment in all regions. Higher investment (actual & planned) in Central Greece & Peloponnese

Biomass MWh/ GJ/ ToE produced and % 945,000 toe annual production (Eurostat 2003), 0.5% of total energy primary production


GJ capacity installed (MW) and % N/A Solar thermal

m2 installed 3,140,000 sq.m. solar panel area (Eurostat 2003)

3,246,000 sq.m. (YPAN 2004))

22% of total EU25

25% of total Greek households

Capacity installed(MW) and %

GWh produced and %

m2 installed

PV

Number of homes/roofs

0 (Eurostat 2003)


Capacity (MW) and % Hydro

Energy production (MWh) and %

Large Hydro:

3,017.80 MW, 4.16 TWh (2005)

Small Hydro:

99.86 MW, 0.30 TWh (2005)

Capacity (MW) and % NA

Energy production (MWh) and % 1,000 toe (Eurostat 2003)

0 (Situation Report 2005)

Geothermal

Sites exploited one

Source: EUROSTAT 2003; Third National Report on Penetration Levels of Renewable Energy Sources, October 2005; Ministry of Development (YPAN)



ANNEX D

4 DRINKING WATER SUPPLY AND SEWERAGE CHARGES

Water supply is metered and billed by each municipal water supply and sewerage company (DEYA, including EYDAP and EYATH). This bill also includes sewerage cost (expressed as a standard percentage of total water supply price of each bill).

Water prices are determined at municipal level with small variations between different municipalities/operators. In all cases, they are defined per user category and are a function of the quantity of the water consumed (progressive volumetric rates with a ceiling for large families), thus providing incentives for water savings. There are no issues on affordability of drinking water prices. All drinking water public supply has metering and practically all households are connected to it (YPEHODE estimate 98% of total country population in 2005; EYDAP records 1.831.520 metered connections in the broader Athens area, servicing a population of 4 million).

The European Environmental Agency and OECD report a 21% average annual increase of domestic water pricing during 1990-95. The pricing list that follows refers to billing by the Thessaloniki Water Supply and Sewerage Company (EYATH S.A.) for its geographic area of responsibility, and is indicative of drinking water supply pricing policy:

Households (4-monthly metering/billing):

Consumption scale in m3

Price (€) 2002

Price (€) 2003

Price (€) 2004

Price (€) 2005

Price (€) 2006

0 to 10 0.24 0.26 0.30 0.33 0.37

11 to 30 0.37 0.40 0.43 0.47 0.50

31 to 60 0.46 0.48 0.52 0.55 0.59

61 to 120 0.90 0.92 0.96 0.99 1.03

121 to 180 1.86 1.94 2.01 2.12 2.27

181m3 and above 3.52 3.70 3.77 3.88 4.03

Industry (monthly metering/billing):

• 1 to 500 m3, 0.44 Euro

• 500m3 and above, 0.73 Euro

• Oil refineries benefit from a fixed rate (ie. independent of consumption) 0.35 Euro

Other consumers:

• Thessaloniki Port Authority: fixed rate 0.88 Euro



• Registered professional premises: fixed rate 0.73 Euro

• Public administration (central, local regional): fixed rate 0.44 Euro

EYATH reports that only 60% of its annual revenue comes from water supply pricing. A significant number of its investment plans are funded through national and EU funds. EYATH’s medium-term pricing policy is based on average increases for the totality of households (however, not for industry and commerce) with a gradual increase for higher consumption levels (maintaining reduced rates for the “basic consumption” of up to 10 m3 per 4 months) to ensure a “reasonable return of the company’s investments and the recovery of the operational cost”. However, it is not realistic to assume that even so water pricing revenue will be able to cover infrastructure or operating costs in water supply in the near future.

EYDAP applies a similar volumetric rate scale for different consumer categories. The average price for the domestic consumer category is 0.73 Euro per m3 (year 2003). Household consumption represents 74% of the company’s revenue. EYDAP reports an average price of 0.67 Euro per m3for water and sewerage.

With respect to agricultural use, it is noted that farmers pay a small fee per “stremma” (1/10 hectare) of cultivated area served by collective irrigation projects to the Local Land Reclamation Board (TOEV) of the Ministry of Agriculture. Water provided for irrigation by the Public Power Corporation (large dams) is not charged.



ANNEX E

5 RENEWABLE ENERGY PRICING: SALES TO THE GRID OF RES PRODUCED ELECTRICITY

The following sale rates to the grid of electricity produced from Renewable Energy Sources (RES) were applied until the issuing of new legislation in June 2006 (Source: Regulatory Authority for Energy).

• For Independent Power Producers selling to the inter-connected system (mainland Greece): 90% of the kWh selling price of the B2 mid-voltage consumer tariff of the Public Power Corporation (for connection to mid or high voltage). With respect to April 2004 applied electricity consumer prices, this represented 0.0645 Euro per kWh.

• For Independent Power Producers selling to the autonomous islands (not inter-connected system): 90% of the Γ22 low-voltage, general use consumer tariff of the Public Power Corporation (PPC). With respect to April 2004 applied electricity consumer prices, this represented 0.0797 Euro per kWh.

• For Auto-producers (both for inter-connected and autonomous systems): 70% of the kWh selling price of the Γ22 consumer tariff of the PPC.

Following the issuing of new legislation in June 2006, the selling prices of RES produced electricity and for RES cogeneration (thermal-electric) have been disassociated from the PPC tariffication system. Also, they provide more advantageous conditions for the autonomous islands. As of 1st August 2006, the guaranteed purchase prices by the grid (the only grid supplier being the PPC) of RES produced electricity are established as follows (Source: Public Power Corporation)

• For Auto-producers (both for connected and autonomous systems): 0.06579 Euro per kWh.

• For Independent Producers: 0.06842 Euro per kWh for interconnected system, and 0.08458 Euro per kWh for the non-interconnected, autonomous islands.

The PPC consumer tariff does not as yet make distinction between RES produced and other electricity. As of 1st August 2006, the Γ22 low-voltage, general use consumer tariff applied by the Public Power Corporation is 0.09821 Euro per kWh. The grid purchase price of RES produced energy represents just under 70% of this consumer sale price, and about 85% in the case of the autonomous islands.

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